2022 was “best year in Leatt’s history”, despite tricky a Q4

Protection focused Leatt had a record breaking 2022, with full year revenue at $76.3 million, up 5%, compared to 2021. Global sales were up 13% to $59.02 million, compared to 2021.

Helmet category sales increase by 60%, compared to 2021, while other products, parts and accessories sales were up 28%, however that was partially offset by a 36% decrease in neck brace sales and a 6% decrease in body armour sales.

Leatt has not been immune to the economic headwinds hitting the cycling and other industries, with the second half of 2022 seeing overstocks.

Despite the brand’s momentum, Leatt boss Sean Macdonald said: “the industry must digest stocking positions before it can return to the buying levels that will support the growth that we have experienced over the last several quarters”.

Q4 revenues were $10.9 million, down 53%, compared to $23.2 million for the fourth quarter of 2021.

2022 highlights saw Leatt pick up awards, winning a 2023 Design & Innovation Award for Mono Suit MTB HydraDri 5.0 and MTB 3.0 Enduro Helmet. It also partnered with the Orbea Leatt Speed Company Racing Team and expanded into the Marathon Endurance Segment.

Outlook

Looking ahead, Leatt said the “current market dynamics will continue for several quarters as our customers continue to digest inventory” while emphasising that the brand is resilient and ” ell-positioned for future growth”. CEO Macdonald said: “Despite the moderation in the exceptional consumer demand levels that the MOTO and MTB industry has experienced over the last several quarters, consumers are still riding and actively participating in outdoor activities – a trend we expect to continue.

“The second half of the year will also see Leatt’s expansion into new areas in the global MTB and MOTO marketplace with well differentiated product categories that showcase innovation and our dedication to consumer adventure. We believe that this continued expansion will appeal to very large total addressable markets.”

Here’s more from Leatt CEO Sean Macdonald; “By many important measures, 2022 was the best year in our Company’s history. Total global revenues were $76.3 million, a 5% increase over 2021 which was itself a strong record year with a 88% increase over the prior year period. International sales grew by $6.68 million, or 13%, despite challenging market dynamics. Sales of some of our most innovative product categories, including helmets, footwear and technical apparel, all increased during 2022 by double digits over 2021. These products showcase our engineering and design teams ability to build exceptional products that appeal to large addressable global markets. We believe that our successes in these critical product areas bode very well for our future.

“The second half of 2022 proved to be a difficult period for the global MTB and MOTO industry. Covid supply chain dynamics, global geo-political issues, inflation, the strengthening of the US dollar and the resultant moderation in consumer demand have resulted in over-stocked inventory across brands at the global distribution and dealer level, and have caused a reduction in product purchases. Changes in our customer buying patterns have begun to filter through in the fourth quarter of 2022.

“Although many consumers, distributors and dealers have noted that the Leatt brand continues to gain momentum backed by cutting-edge product innovation, the industry must digest stocking positions before it can return to the buying levels that will support the growth that we have experienced over the last several quarters.

“These market and economic conditions, directly affected our fourth quarter and year-end results, compared to 2021. Although full fiscal year 2022 sales of our more established neck brace and body armour categories were down by 36% and 6%, respectively, when compared to exceptionally strong 2021 sales, helmet sales increased by 60% and other products, parts and accessory sales that include our apparel category increased by 28%   Net income for the year was $9.96 million, down 21% with a return on revenue of 13%. Earnings per share for the full year 2022 was $1.71 per basic share.

“Fourth quarter 2022 revenues were $10.9 million, a decrease of 53 percent compared to a very strong fourth quarter of 2021. Net loss for the fourth quarter was $1.1 million, based on the decrease in revenues and a 17% increase in total operating costs driven by our investments in sales, product development and marketing of our growing product range and the development of a globally recognised consumer brand.”

Hotlines brings Leatt to the UK cycling industry.