Shimano Inc has reported that sales for the year ended 31 December 2009 fell 20.6% year on year to ¥186.7 billion (US$2 billion / €1.5 billion).
The Japanese manufacturer of bike components and fishing tackle reported that overall operating income dropped 45.7% year on year to ¥20.5 billion. Net income declined 62.0% to ¥9.6 billion or ¥99.80 per share. This compared to ¥262.1 per share in 2008.
The global economic recession has been singled out as a primary cause for the sharp falls in Shimano’s performance. A dependence on the Japanese economy and its precarious economic situation has likewise impacted the company. According to Shimano, “the Japanese economy remained in a severe situation.”
Shimano’s sales of bicycle components fell 22.2% to ¥144.7 billion. This resulted in a 43.4% decline in operating income to ¥18.9 billion.
One area of positive improvement was cash flow. This more than doubled in 2009 to ¥42.6 billion, up from ¥19.9 billion. A quarter of this positive cash flow figure, ¥10.5 billion, came from decreased inventory.
Despite the challenges faced in 2009, Shimano expects overall net sales to rise 7.7% in the first half of fiscal 2010. Annual net sales are projected to rise by 9.8% for the entire fiscal year to ¥205 billion.
This figure is comprised of ¥161.0 billion in bike division sales, with the remainder coming from fishing tackle. The company’s expects operating income to rebound 46.1% to ¥30.0 billion and net income to rise 109.3% to ¥820.0 billion, or ¥201.7 per share. The majority of this growth is expected to be generated in the second half of the year. The company said improved profitability would also come from streamlining of production and logistics.
