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Giant’s first-half revenue dips as uncertainty roils global market

Published August 10, 2016

TAICHUNG, Taiwan (BRAIN) — Continued turmoil in the global bicycle market has pummeled Giant Manufacturing’s first-half financial results, with the world’s leading maker of bicycles posting a 3.7 percent drop in revenue compared with a year earlier.

Giant also forecasted continued uncertainty in the marketplace as the industry heads toward the end of the year.

For Giant, the numbers are mixed. Basic earnings per share, or EPS, in the first half of the year totaled NT$4.52 (15 cents), off substantially from Giant's average EPS of NT$9.63 during 2015.  

However, Giant’s stock price has rebounded from a low of NT$176 in early April to about NT$224 ($7.21 per share) in August — a 27.2 percent increase.

Giant reported its results for the first half in a press release issued Wednesday. Overall, group revenue fell to NT$29.1 billion ($936.1 million), compared with first half revenue last year of NT$30.2 billion — a 3.7 percent decline.

After-tax income also fell 5 percent in the first half to NT$1.69 billion ($54.4 million).

As for Giant’s in-house brands, sales in China remain a drag on the company’s revenue with sales down 20 percent in the first half. But Giant said that in the long run the company remains bullish on growth in the Chinese market.

Turning to other regions, European sales performed best, with Japan and Australia also doing well. But it was a different story in the U.S., where high inventory levels in the first half dragged down performance. Giant offered no unit sales comparisons or percentage sales levels, other than China’s, for its regional sectors.

“With uncertainties surrounding the global economy, the bicycle market remains competitive. Giant projects this year that the overall European bicycle market will remain flat, but e-bike sales shall continue to see growth,” Giant stated.

“For the U.S. market, in terms of inventory position, Giant’s inventory level is healthy compared to other major brands, although major bicycle brands in the U.S. have taken steps to improve the inventory situation in the first half of 2016. Nevertheless, the inventory situation and how it will impact overall market demand will require further observation,” Giant added.

 

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