Dorel Reports Improved First Quarter 2016 Results

MONTRÉAL, QUÉBEC--(Marketwired - May 6, 2016) - Dorel Industries Inc. (TSX:DII.B)(TSX:DII.A) today released results for the first quarter ended March 31, 2016. Total revenue was US$645.9 million, down 2.9% from US$665.5 million a year ago. Adjusted net income for the quarter was up 66.7% to US$19.7 million or US$0.60 per diluted share from US$11.8 million, or US$0.36 per diluted share in 2015. Reported net income increased 43.9% to US$16.7 million, or US$0.51 per diluted share, compared to US$11.6 million or US$0.36 per diluted share in the first quarter of 2015.

"We are pleased with the positive start to the year. Dorel Home Furnishings delivered another record quarter and has evolved into a growth company with opportunity for further expansion with its on-line customers. Newly introduced Dorel Juvenile products are resonating well with consumers and improved pricing has resulted in better gross margins in the majority of our markets," commented Martin Schwartz, Dorel President & CEO.

As detailed below, the reported net income includes restructuring and other costs and remeasurement of forward purchase agreement liabilities. As such, the Company is presenting adjusted financial information as it believes that excluding these items is a more meaningful comparison of its core business performance between the periods presented. Contained within this press release are reconciliations of non-GAAP financial measures to the most directly comparable financial measures calculated in accordance with GAAP.

Summary of Financial Information (unaudited)
First Quarters Ended March 31
All figures in thousands of US $, except per share amounts
		2016	2015
		$	$	Change %
Total revenue		645,867	665,489	(2.9	%)
Net income		16,734	11,632	43.9	%
	Per share - Basic	0.52	0.36	44.4	%
	Per share - Diluted	0.51	0.36	41.7	%
Adjusted net income		19,671	11,799	66.7	%
	Per share - Basic	0.61	0.37	64.9	%
	Per share - Diluted	0.60	0.36	66.7	%
Number of shares outstanding -
	Basic weighted average	32,333,261	32,321,639
	Diluted weighted average	32,545,454	32,513,889

Dorel Juvenile

All figures in thousands of US $
First Quarters Ended March 31 (unaudited)
	2016			2015
	$	% of rev.		$	% of rev.		Change %
Total revenue	253,228			274,695			(7.8	%)
Gross profit	73,033	28.8	%	71,441	26.0	%	2.2	%
Operating profit	15,620	6.2	%	9,175	3.3	%	70.2	%
Adjusted gross profit	73,033	28.8	%	71,441	26.0	%	2.2	%
Adjusted operating profit	18,585	7.3	%	10,292	3.7	%	80.6	%

Dorel Juvenile's first quarter revenue decreased by US$21.5 million or 7.8% to US$253.2 million compared with US$274.7 million in 2015. Organic revenue declined by approximately 4% after removing the impact of varying exchange rates year-over-year, mainly attributable to lower sales in the U.S. and planned reduced third party sales at Dorel Juvenile China. Adjusted operating profit, excluding restructuring and other costs, rose by US$8.3 million or 80.6% to US$18.6 million. This was due to both improved margins and lower operating expenses, driven by cost savings from the segment's restructuring activities in China, Europe and North America. Foreign exchange rates were weaker against the US dollar compared to last year's first quarter, with the exception of the Chinese Yuan. However, price increases and production efficiencies more than offset the foreign exchange impact, and contributed to an increase in gross margin from 26.0% to 28.8%.

The production transfer of certain products continues from third party suppliers to Dorel Juvenile China's manufacturing facilities, in line with the Company's change in sourcing strategy and the transformation of the segment into a more fully integrated operation. Despite the reduced third party sales, the Dorel Juvenile China operation was a contributor to the segment's increased operating profit.

The segment recorded restructuring expenses of US$2.2 million, primarily for employee severance and termination benefits.

Dorel Sports

All figures in thousands of US $
First Quarters Ended March 31 (unaudited)
	2016			2015
	$	% of rev.		$	% of rev.		Change %
Total revenue	216,497			228,929			(5.4	%)
Gross profit	47,498	21.9	%	53,460	23.4	%	(11.2	%)
Operating profit	5,254	2.4	%	11,562	5.1	%	(54.6	%)

Dorel Sports revenue decreased by US$12.4 million or 5.4% to US$216.5 million compared to US$228.9 million last year. After removing the impact of varying year-over-year foreign exchange rates, organic revenue declined by approximately 3%. Part of the shortfall was due to shipments of 2016 model year bicycles in the Cycling Sports Group (CSG) occurring in December 2015 as opposed to in the first quarter of 2016. This was made possible by improvements in on-time delivery. The lower revenue was also due to the non-recurrence of higher sales to European dealers who stocked up in March 2015 in advance of an expected April 2015 price increase triggered by currency pressures. Partly offsetting this were strong bicycle sales by Pacific Cycle to U.S. mass market customers, mostly for the Schwinn and Mongoose brands, as the favourable weather and earlier Easter holiday benefitted March sales.

Operating profit decreased to US$5.3 million from US$11.6 million due to the decreased sales as explained above and lower margins from discounting on the independent bike dealers (IBD) sales in the U.S. in order to maintain market share as key competition executed price decreases to reduce their excess inventory.

Dorel Home Furnishings

All figures in thousands of US $
First Quarters Ended March 31 (unaudited)
	2016			2015
	$	% of rev.		$	% of rev.		Change %
Total revenue	176,142			161,865			8.8	%
Gross profit	29,522	16.8	%	20,674	12.8	%	42.8	%
Operating profit	16,468	9.3	%	9,550	5.9	%	72.4	%

Dorel Home Furnishings revenue increased by US$14.3 million, or 8.8% to a record US$176.1 million compared with US$161.8 million a year ago. The segment recorded another superior quarter of sales to on-line retailers which continue to drive revenue growth. The e-commerce distribution channel represented 42% of total segment sales, compared to 30% last year. This growth far exceeded reductions in sales through the brick and mortar channel.

Operating profit increased to US$16.5 million from US$9.6 million, reaching 9.3% as a percentage of revenue. This was due to the continuing sales growth as well as higher margins attained through the e-commerce distribution channel. Partly offsetting the improved gross margin dollars were higher selling and general and administrative expenses to support the significant sales growth in the quarter.

Other

The Company's effective first quarter tax rate was 17.2% versus 24.3% the prior year. The Company has stated that for the full year it expects its annual tax rate to be between 15% and 20%.

During the first three months of 2016, the Company's focus on generating increased cash flow provided the desired results. Cash flow used by operating activities was US$5.9 million, significantly less than US$86.5 million used in 2015. The main reasons for the improvement were higher net income and decreased inventory levels compared with an increase during the first quarter of 2015.

Quarterly dividend

Dorel's Board of Directors declared its regular quarterly dividend of US$0.30 per share on the outstanding number of the Company's Class A Multiple Voting Shares, Class B Subordinate Voting Shares, Deferred Share Units and cash-settled Performance Share Units. The dividend is payable on June 3, 2016 to shareholders of record as at the close of business on May 20, 2016.

Outlook

"2016 has begun, as expected, with a significant increase in earnings over last year's first quarter. In our Juvenile segment, improved margins and cost containment resulted in significant progress in the first quarter. We are confident of a much better 2016 with organic sales growth in all markets except China where we are managing the planned exit of third party competitor sales from our China factories, offsetting the lost sales with our own insourced product and significant improvements in operations. The second quarter will not exceed prior year, but this is only a function of timing. The second half will continue the positive trend of the first quarter," stated Martin Schwartz, Dorel President & CEO.

"In Home Furnishings, we have started the year with our best quarter in many years as our line of furniture is extremely well-suited to the e-commerce sales channel. We identified several years ago that this channel was going to be the future of our industry and we are now capitalizing on our operational investments to increasingly capture this business. We have placed more products at more customers each year, and the results are evident. While the pace of earnings improvement will slow, we expect to continue to deliver strong results compared to prior years."

"The Pacific Cycle division will continue to grow modestly through the year and will surpass 2015 in both sales and earnings. The Schwinn brand has strong traction with consumers and this has been translated into a solid first quarter in the mass channel. Despite the situation in Brazil, Caloi is on target to meet its earnings objectives, although sales will be down year-over-year. Price competition in the IBD sector is making for a challenging first half and demand for premium bicycles is uncertain. We foresee improvement during the second half as Dorel's line of model year 2017 bikes is compelling and there has been good reaction to the recently introduced Quick and Scalpel models. Additional models will be introduced later this year. We will continue to be proactive in CSG and we will closely monitor the situation throughout the year. However, despite the slow start, Dorel Sports is expected to exceed 2015's performance."

"Overall our strength in the Juvenile and Home Furnishing segments should lead Dorel to an improved 2016 performance," concluded Mr. Schwartz.

Conference Call

Dorel Industries Inc. will hold a conference call to discuss these results today, May 6, 2016 at 1:00 P.M. Eastern Time. Interested parties can join the call by dialing 1-877-223-4471. The conference call can also be accessed via live webcast at http://www.dorel.com/eng/events. If you are unable to call in at this time, you may access a recording of the meeting by calling 1-800-585-8367 and entering the passcode 95988582 on your phone. This recording will be available on Friday, May 6, 2016 as of 4:00 P.M. until 11:59 P.M. on Friday, May 13, 2016.

Complete condensed consolidated interim financial statements as at March 31, 2016 will be available on the Company's website, www.dorel.com, and will be available through the SEDAR website.

Profile

Dorel Industries Inc. (TSX:DII.B)(TSX:DII.A) is a world class juvenile products and bicycle company. The Company's safety and lifestyle leadership is pronounced in both its Juvenile and Bicycle categories with an array of trend-setting, innovative products. Dorel Juvenile's powerfully branded products include global juvenile brands Safety 1^st, Quinny, Maxi-Cosi and Tiny Love, complemented by regional brands such as Cosco, Bébé Confort and Infanti. In Dorel Sports, brands include Cannondale, Schwinn, GT, Mongoose, Caloi, IronHorse and SUGOI. Dorel Home Furnishings markets a wide assortment of both domestically produced and imported furniture products, principally within North America. Dorel Industries Inc. has annual sales of US$2.7 billion and employs approximately 10,450 people in facilities located in twenty-five countries worldwide.

Caution Regarding Forward Looking Statements

Certain statements included in this press release may constitute "forward-looking statements" within the meaning of applicable Canadian securities legislation. Except as may be required by Canadian securities laws, Dorel does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements, by their very nature, are subject to numerous risks and uncertainties and are based on several assumptions which give rise to the possibility that actual results could differ materially from Dorel's expectations expressed in or implied by such forward-looking statements and that the objectives, plans, strategic priorities and business outlook may not be achieved. As a result, Dorel cannot guarantee that any forward-looking statement will materialize, or if any of them do, what benefits Dorel will derive from them. Forward-looking statements are provided in this press release for the purpose of giving information about Management's current expectations and plans and allowing investors and others to get a better understanding of Dorel's operating environment. However, readers are cautioned that it may not be appropriate to use such forward-looking statements for any other purpose.

Forward-looking statements made in this press release are based on a number of assumptions that Dorel believed were reasonable on the day it made the forward-looking statements. Factors that could cause actual results to differ materially from Dorel's expectations expressed in or implied by the forward-looking statements include: general economic conditions; changes in product costs and supply channels; foreign currency fluctuations; customer and credit risk, including the concentration of revenues with a small number of customers; costs associated with product liability; changes in income tax legislation or the interpretation or application of those rules; the continued ability to develop products and support brand names; changes in the regulatory environment; continued access to capital resources and the related costs of borrowing; changes in assumptions in the valuation of goodwill and other intangible assets; and there being no certainty that Dorel's current dividend policy will be maintained. These and other risk factors that could cause actual results to differ materially from expectations expressed in or implied by the forward-looking statements are discussed in Dorel's annual Management Discussion and Analysis and Annual Information Form filed with the applicable Canadian securities regulatory authorities. The risk factors outlined in the previously-mentioned documents are specifically incorporated herein by reference.

Dorel cautions readers that the risks described above are not the only ones that could impact it. Additional risks and uncertainties not currently known to Dorel or that Dorel currently deems to be immaterial may also have a material adverse effect on Dorel's business, financial condition or results of operations. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results.

Non-GAAP financial measures

As a result of restructuring and other costs and remeasurement of forward purchase agreement liabilities incurred in both 2016 and 2015, the Company is including in this press release the following non-GAAP financial measures: "adjusted operating profit", "adjusted finance expenses", "adjusted income before income taxes", "adjusted income taxes expense", "adjusted net income", and "adjusted earnings per basic and diluted share". The Company believes that this results in a more meaningful comparison of its core business performance between the periods presented. These non-GAAP financial measures do not have a standardized meaning prescribed by GAAP and therefore are unlikely to be comparable to similar measures presented by other issuers. Contained within this press release are reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated in accordance with GAAP.

(All figures are in thousands of US$, except per share amounts)

Reconciliation of non-GAAP financial measures:
	Three months ended March 31
	2016								2015
	Reported		% of revenue	Restruc-turing and other costs		Adjusted		% of revenue	Reported		% of revenue	Restruc-turing and other costs		Adjusted		% of revenue
	$		%	$		$		%	$		%	$		$		%
TOTAL REVENUE	645,867		100.0	-		645,867		100.0	665,489		100.0	-		665,489		100.0
Cost of sales	495,814		76.8	-		495,814		76.8	519,914		78.1	-		519,914		78.1
GROSS PROFIT	150,053		23.2	-		150,053		23.2	145,575		21.9	-		145,575		21.9
Selling expenses	56,341		8.7	-		56,341		8.7	56,257		8.5	-		56,257		8.5
General and administrative expenses	51,620		8.0	-		51,620		8.0	56,156		8.4	-		56,156		8.4
Research and development expenses	8,269		1.3	-		8,269		1.3	8,512		1.3	-		8,512		1.3
Restructuring and other costs	2,937		0.4	(2,937	)	-		-	917		0.1	(917	)	-		-
OPERATING PROFIT	30,886		4.8	2,937		33,823		5.2	23,733		3.6	917		24,650		3.7
Finance expenses	10,678		1.7	(561	)	10,117		1.5	8,375		1.3	401		8,776		1.3
INCOME BEFORE INCOME TAXES	20,208		3.1	3,498		23,706		3.7	15,358		2.3	516		15,874		2.4
Income taxes expense	3,474		0.5	561		4,035		0.7	3,726		0.6	349		4,075		0.6
Tax rate	17.2	%	-	-		17.0	%	-	24.3	%	-	-		25.7	%	-
NET INCOME	16,734		2.6	2,937		19,671		3.0	11,632		1.7	167		11,799		1.8
EARNINGS PER SHARE
Basic	0.52			0.09		0.61			0.36			0.01		0.37
Diluted	0.51			0.09		0.60			0.36			-		0.36
SHARES OUTSTANDING
Basic - weighted average	32,333,261					32,333,261			32,321,639					32,321,639
Diluted - weighted average	32,545,454					32,545,454			32,513,889					32,513,889

The results for the quarter include restructuring costs of US$2.2 million and acquisition costs of US$0.7 million for a total of US$2.9 million of restructuring and other costs all related to Dorel Juvenile compared to US$0.9 million for the first quarter last year which was mainly acquisition-related costs for Dorel Juvenile China.

Dorel Juvenile

Reconciliation of non-GAAP financial measures:

	Three months ended March 31
	2016						2015
	Reported	% of revenue	Restruc-turing and other costs		Adjusted	% of revenue	Reported	% of revenue	Other costs		Adjusted	% of revenue
	$	%	$		$	%	$	%	$		$	%
TOTAL REVENUE	253,228	100.0	-		253,228	100.0	274,695	100.0	-		274,695	100.0
Cost of sales	180,195	71.2	-		180,195	71.2	203,254	74.0	-		203,254	74.0
GROSS PROFIT	73,033	28.8	-		73,033	28.8	71,441	26.0	-		71,441	26.0
Selling expenses	28,494	11.3	-		28,494	11.3	28,818	10.5	-		28,818	10.5
General and administrative expenses	20,283	8.0	-		20,283	8.0	26,161	9.6	-		26,161	9.6
Research and development expenses	5,671	2.2	-		5,671	2.2	6,170	2.2	-		6,170	2.2
Restructuring and other costs	2,965	1.1	(2,965	)	-	-	1,117	0.4	(1,117	)	-	-
OPERATING PROFIT	15,620	6.2	2,965		18,585	7.3	9,175	3.3	1,117		10,292	3.7

DOREL INDUSTRIES INC.
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION
ALL FIGURES IN THOUSANDS OF US $
(unaudited)
			as at March 31, 2016			as at December 30, 2015
ASSETS
CURRENT ASSETS
	Cash and cash equivalents	$	38,540		$	33,182
	Trade and other receivables		479,873			447,345
	Inventories		562,241			584,986
	Other financial assets		2,670			4,467
	Income taxes receivable		8,956			12,985
	Prepaid expenses		32,798			20,234
			1,125,078			1,103,199
	Assets held for sale		11,309			11,265
			1,136,387			1,114,464
NON-CURRENT ASSETS
	Property, plant and equipment		207,133			206,542
	Intangible assets		474,089			465,447
	Goodwill		485,307			476,330
	Deferred tax assets		39,569			37,258
	Other assets		6,451			4,904
			1,212,549			1,190,481
		$	2,348,936		$	2,304,945
LIABILITIES
CURRENT LIABILITIES
	Bank indebtedness	$	45,804		$	54,471
	Trade and other payables		408,193			434,178
	Written put option and forward purchase agreement liabilities		-			4,104
	Other financial liabilities		2,922			895
	Income taxes payable		18,029			15,590
	Long-term debt		33,861			32,857
	Provisions		34,809			34,267
			543,618			576,362
NON-CURRENT LIABILITIES
	Long-term debt		510,349			465,732
	Net pension and post-retirement defined benefit liabilities		43,006			43,058
	Deferred tax liabilities		70,792			72,447
	Provisions		1,833			1,702
	Written put option and forward purchase agreement liabilities		33,201			30,788
	Other financial liabilities		2,483			1,890
	Other long-term liabilities		9,795			10,569
			671,459			626,186
EQUITY
Share capital			200,338			200,277
Contributed surplus			26,552			26,480
Accumulated other comprehensive loss			(87,707	)		(113,956	)
Other equity			(363	)		1,527
Retained earnings			995,039			988,069
			1,133,859			1,102,397
		$	2,348,936		$	2,304,945

DOREL INDUSTRIES INC.
CONDENSED CONSOLIDATED INTERIM INCOME STATEMENTS
ALL FIGURES IN THOUSANDS OF US $, EXCEPT PER SHARE AMOUNTS
(unaudited)
			Three Months Ended
			March 31, 2016		March 31, 2015
Sales		$	642,572	$	661,394
Licensing and commission income			3,295		4,095
TOTAL REVENUE			645,867		665,489
Cost of sales			495,814		519,914
GROSS PROFIT			150,053		145,575
Selling expenses			56,341		56,257
General and administrative expenses			51,620		56,156
Research and development expenses			8,269		8,512
Restructuring and other costs			2,937		917
OPERATING PROFIT			30,886		23,733
Finance expenses			10,678		8,375
INCOME BEFORE INCOME TAXES			20,208		15,358
Income taxes expense			3,474		3,726
NET INCOME		$	16,734	$	11,632
EARNINGS PER SHARE
	Basic	$	0.52	$	0.36
	Diluted	$	0.51	$	0.36
SHARES OUTSTANDING
	Basic - weighted average		32,333,261		32,321,639
	Diluted - weighted average		32,545,454		32,513,889

DOREL INDUSTRIES INC.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

ALL FIGURES IN THOUSANDS OF US $

(unaudited)

		Three Months Ended
		March 31, 2016			March 31, 2015
NET INCOME	$	16,734		$	11,632
OTHER COMPREHENSIVE INCOME (LOSS):
Items that are or may be reclassified subsequently to net income:
Cumulative translation account:
Net change in unrealized foreign currency gains (losses) on translation of net investments in foreign operations, net of tax of nil		21,996			(44,459	)
Net gains (losses) on hedge of net investments in foreign operations, net of tax of nil		6,576			(16,951	)
		28,572			(61,410	)
Net changes in cash flow hedges:
Net change in unrealized gains (losses) on derivatives designated as cash flow hedges		(3,614	)		3,884
Reclassification to income		183			311
Reclassification to the related non-financial asset		(238	)		(3,596	)
Deferred income taxes		1,352			(98	)
		(2,317	)		501
Items that will not be reclassified to net income:
Defined benefit plans:
Remeasurements of the net pension and post-retirement defined benefit liabilities		(13	)		133
Deferred income taxes		7			(44	)
		(6	)		89
TOTAL OTHER COMPREHENSIVE INCOME (LOSS)		26,249			(60,820	)
TOTAL COMPREHENSIVE INCOME (LOSS)	$	42,983		$	(49,188	)

DOREL INDUSTRIES INC.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN EQUITY

ALL FIGURES IN THOUSANDS OF US $

(unaudited)

		Attributable to equity holders of the Company
								Accumulated other comprehensive income (loss)
			Share Capital		Contributed Surplus			Cumulative Translation Account			Cash Flow Hedges			Defined Benefit Plans			Other Equity			Retained Earnings			Total Equity
Balance as at December 30, 2014		$	199,927	$	25,691		$	(8,842	)	$	2,180		$	(13,917	)	$	579		$	1,001,366		$	1,206,984
Total comprehensive loss:
	Net income		-		-			-			-			-			-			11,632			11,632
	Other comprehensive income (loss)		-		-			(61,410	)		501			89			-			-			(60,820	)
		$	-	$	-		$	(61,410	)	$	501		$	89		$	-		$	11,632		$	(49,188	)
Reclassification from contributed surplus due to settlement of deferred share units			61		(101	)		-			-			-			-			-			(40	)
Share-based payments			-		71			-			-			-			-			-			71
Remeasurement of written put option liabilities			-		-			-			-			-			(402	)		-			(402	)
Dividends on common shares			-		-			-			-			-			-			(9,697	)		(9,697	)
Dividends on deferred share units			-		54			-			-			-			-			(54	)		-
Balance as at March 31, 2015		$	199,988	$	25,715		$	(70,252	)	$	2,681		$	(13,828	)	$	177		$	1,003,247		$	1,147,728
Balance as at December 30, 2015		$	200,277	$	26,480		$	(104,521	)	$	2,680		$	(12,115	)	$	1,527		$	988,069		$	1,102,397
Total comprehensive income:
	Net income		-		-			-			-			-			-			16,734			16,734
	Other comprehensive income (loss)		-		-			28,572			(2,317	)		(6	)		-			-			26,249
		$	-	$	-		$	28,572		$	(2,317	)	$	(6	)	$	-		$	16,734		$	42,983
Reclassification from contributed surplus due to settlement of deferred share units			61		(103	)		-			-			-			-			-			(42	)
Share-based payments			-		113			-			-			-			-			-			113
Remeasurement of written put option liabilities			-		-			-			-			-			(1,890	)		-			(1,890	)
Dividends on common shares			-		-			-			-			-			-			(9,702	)		(9,702	)
Dividends on deferred share units			-		62			-			-			-			-			(62	)		-
Balance as at March 31, 2016		$	200,338	$	26,552		$	(75,949	)	$	363		$	(12,121	)	$	(363	)	$	995,039		$	1,133,859

DOREL INDUSTRIES INC.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS

ALL FIGURES IN THOUSANDS OF US $

(unaudited)

			Three Months Ended
			March 31, 2016			March 31, 2015
CASH PROVIDED BY (USED IN):
OPERATING ACTIVITIES
Net income		$	16,734		$	11,632
Items not involving cash:
	Depreciation and amortization		13,045			14,290
	Unrealized losses (gains) arising on financial assets and financial liabilities classified as held for trading		746			(353	)
	Share-based payments		113			71
	Defined benefit pension and post-retirement costs		961			825
	Loss (gain) on disposal of property, plant and equipment		16			(86	)
	Restructuring and other costs		424			-
Finance expenses			10,678			8,375
Income taxes expense			3,474			3,726
Net change in balances related to operations			(48,864	)		(117,406	)
Income taxes paid			(3,440	)		(6,593	)
Income taxes received			4,790			2,725
Interest paid			(4,679	)		(3,842	)
Interest received			86			140
CASH USED IN OPERATING ACTIVITIES			(5,916	)		(86,496	)
FINANCING ACTIVITIES
Bank indebtedness			(11,632	)		49,631
Increase of long-term debt			43,412			67,059
Repayments of long-term debt			(4,309	)		(3,806	)
Repayments of written put option and forward purchase agreement liabilities			(4,414	)		-
Increase of written put option and forward purchase agreement liabilities			-			525
Financing costs			(1,740	)		(34	)
Dividends on common shares			(9,702	)		(9,697	)
CASH PROVIDED BY FINANCING ACTIVITIES			11,615			103,678
INVESTING ACTIVITIES
Acquisition of businesses			5,475			(1,736	)
Additions to property, plant and equipment			(5,242	)		(7,079	)
Disposals of property, plant and equipment			113			456
Additions to intangible assets			(4,482	)		(4,489	)
CASH USED IN INVESTING ACTIVITIES			(4,136	)		(12,848	)
Effect of foreign currency exchange rate changes on cash and cash equivalents			3,795			(4,124	)
NET INCREASE IN CASH AND CASH EQUIVALENTS			5,358			210
Cash and cash equivalents, beginning of period			33,182			47,101
CASH AND CASH EQUIVALENTS, END OF PERIOD		$	38,540		$	47,311
Supplemental information on net changes in balances related to operations:
	Trade and other receivables	$	(29,981	)	$	(48,461	)
	Inventories		33,018			(34,122	)
	Other financial assets		(1,128	)		183
	Prepaid expenses		(11,967	)		(9,027	)
	Other assets		(317	)		(31	)
	Trade and other payables		(37,202	)		(20,758	)
	Net pension and post-retirement defined benefit liabilities		(1,411	)		(1,401	)
	Provisions, other financial liabilities and other long-term liabilities		124			(3,789	)
		$	(48,864	)	$	(117,406	)

DOREL INDUSTRIES INC.

SEGMENTED INFORMATION

FIRST QUARTERS ENDED MARCH 31

ALL FIGURES IN THOUSANDS OF US $, EXCEPT PER SHARE AMOUNTS

(unaudited)

			Total				Dorel Juvenile				Dorel Sports						Dorel Home Furnishings
			2016		2015		2016		2015		2016			2015			2016		2015
Total revenue		$	645,867	$	665,489	$	253,228	$	274,695	$	216,497		$	228,929		$	176,142	$	161,865
Cost of sales			495,814		519,914		180,195		203,254		168,999			175,469			146,620		141,191
Gross profit			150,053		145,575		73,033		71,441		47,498			53,460			29,522		20,674
Selling expenses			55,878		55,547		28,494		28,818		22,401			22,587			4,983		4,142
General and administrative expenses			45,627		50,312		20,283		26,161		18,299			18,048			7,045		6,103
Research and development expenses			8,269		8,512		5,671		6,170		1,572			1,463			1,026		879
Restructuring and other costs			2,937		917		2,965		1,117		(28	)		(200	)		-		-
Operating profit			37,342		30,287	$	15,620	$	9,175	$	5,254		$	11,562		$	16,468	$	9,550
Finance expenses			10,678		8,375
Corporate expenses			6,456		6,554
Income taxes expense			3,474		3,726
Net income		$	16,734	$	11,632
Earnings per share
	Basic	$	0.52	$	0.36
	Diluted	$	0.51	$	0.36
Depreciation and amortization included in operating profit		$	12,844	$	14,246	$	8,890	$	9,686	$	2,838		$	3,381		$	1,116	$	1,179