Asics reports 7.4 percent drop in Q1 net sales

In the first quarter ended March 31, 2018, consolidated net sales decreased 7.4 percent or 9.4 percent at foreign exchange rate to 104,642 million Japanese yen (953.1 million dollars).

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The company said in a statement that in the first quarter business was steady in the sporting goods industry on the back of a high level of interest in sports owing to rising health consciousness, as well as an increase in everyday use of sporting goods. Under these conditions, the Asics Group revised the five-year strategic plan, “Asics Growth Plan (AGP) 2020”, in order to establish the foundation of further growth, and designated running shoes in the US market, the Chinese market, and digital commerce and marketing as those in priority areas.

Domestic sales down 7.1 percent, international 7.6 percent

Domestic net sales for the quarter decreased 7.1 percent to 28,625 million Japanese yen (260.7 million dollars) due to reduction of the lines of sportswear products with low profit margins. Overseas sales decreased 7.6 percent or 10.3 percent at foreign exchange rate to 76,016 million Japanese yen (692.2 million dollars) mainly due to weak sales in the American region, despite strong sales of running shoes and Onitsuka Tiger shoes in the East Asian region and steady sales of Onitsuka Tiger shoes in the Oceanian/Southeast and South Asian regions.

Gross profit decreased 3.2 percent to 49,854 million Japanese yen (454 million dollars) mainly due to lower sales despite an improved cost of sales ratio. Operating income decreased 35.4 percent to 8,549 million Japanese yen (77.8 million dollars), while ordinary income decreased 47.2 percent to 7,414 million Japanese yen (67.5 million dollars) due to foreign exchange losses recorded in the first quarter ended March 31, 2018 compared to foreign exchange gains posted in the corresponding period of the previous fiscal year. Profit attributable to owners of parent decreased 43.2 percent to 5,315 million Japanese yen (48.4 million dollars).

Asics Q1 performance across core markets

Sales in the Japanese region decreased 7 percent to 32,928 million Japanese yen (299.8 million dollars), due to reduction of the lines of sportswear products with low profit margins. Segment income decreased 52.8 percent to 1,710 million Japanese yen (15.5 million dollars), due to the effect of the decline in sales.

American region sales decreased 26.6 percent or 23.3 percent at foreign exchange rate to 21,927 million Japanese yen (199.6 million dollars), due to weak sales in the US. Segment income decreased 82.8 percent or 82 percent at foreign exchange rate to 443 million Japanese yen (4.03 million dollars) due to the effect of the decline in sales despite an improved cost of sales ratio.

European region sales increased 3.7 percent or decreased 5.8 percent at foreign exchange rate to 28,730 million Japanese yen (261.6 million dollars), due to steady sales in certain emerging-market countries. Segment income increased 2.4 percent or decreased 7 percent at foreign exchange rate to 2,358 million Japanese yen (21.4 million dollars).

Sales in Oceanian/Southeast and South Asian regions decreased 6.3 percent or 7.3 percent at foreign exchange rate to 7,560 million Japanese yen (68.8 million dollars), due to weak sales in Australia despite strong sales in Southeast and South Asian regions. Segment income decreased 7.6 percent or of 8.5 percent using foreign exchange rate to 1,446 million Japanese yen (13.1 million dollars).

East Asian region sales increased 5.8 percent or 2.7 percent at foreign exchange rate to 14,688 million Japanese yen (133.7 million dollars) due to the strong sales of running shoes and Onitsuka Tiger shoes particularly in China despite the weak sales in South Korea. Segment income decreased 25.8 percent or 27.7 percent at foreign exchange rate to 1,931 million Japanese yen (17.5 million dollars), due to vigorous advertising investment in China and the effect of lower profit in South Korea.

Sales of other businesses increased 12.6 percent or 7.2 percent at foreign exchange rate to 2,981 million Japanese yen (27.1 million dollars), due to steady sales of outdoor wear and other items under the HAGLÖFS brand and the effect of the foreign exchange rate. Segment income was 197 million Japanese yen (1.7 million dollars).

Picture:Facebook/Asics

 

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