VAN NUYS, CA (BRAIN)—Last year's merger of Easton Sports and Riddell Bell Holdings has paid off in a big way for the now combined company.
Easton-Bell Sports reported a 13.4 percent increase in net sales for 2007 to $724.6 million from $639.0 million in 2006, as the company clearly benefited from a full year's worth of Easton sales this year compared to results from the date of acquisition on March 16, 2006.
During 2007, an additional $67.9 million and $0.4 million in net sales were attributable to the Easton and Cyclo/Shanghai Cyclo acquisitions, respectively, with $62.9 million attributable to Team Sports and $5.4 million attributable to Action Sports.
Team Sports net sales increased 19.8 percent to $416.5 million, as compared to 2006. In addition to the acquisition of Easton, other factors contributing to the increase in Team Sports net sales included increased football shoulder pad and apparel sales and reconditioning services.
Action Sports net sales increased 5.8 percent to $308.1 million, when compared to 2006. The increase resulted from the inclusion of a full fiscal year of Easton’s cycling business and the acquisition of Cyclo/Shanghai Cyclo, growth in sales of cycling helmets and specialty channel accessories and the introduction of Giro branded eyewear, all of which were partially offset by a mild decrease in sales of snow helmets.
For 2007, gross profit was $248.9 million, or 34.4 percent of net sales, as compared to $212.9 million, or 33.3 percent of net sales for 2006. The increase in gross profit as a percentage of net sales is primarily attributable to the cost savings realized from transitioning the manufacturing of certain aluminum products to Asia from the United States, foreign currency gains in our international operations and the impact in 2006 of expensing the purchase accounting inventory write-up associated with the Easton acquisition, partially offset by sales mix changes and increased distribution costs, freight costs and inventory write-offs.