Shimano bike division adds 14% in Q1, but market “cooling”

Shimano has issued its financial results for the first quarter, within which cycling division sales bumped up 13.9% like-for-like. What may prove more interesting for the trade at large is the world’s largest component maker describing a market that is “showing signs of cooling down”.

With consumer sentiment hitting new lows in many parts of the world inventories were described by Shimano as “approaching appropriate levels” on entry-class and middle-class bicycles “while demand centering around high-end class bicycles remained high.”

In Europe, demand remained robust for cycling goods, something Shimano attributed to Governments continuing to support cycling in policy shifts, some of which had been pressed on with faster as a result of pressure to begin chipping away at the climate crisis. Demand for electric bikes remained “strong”.

Further west, North American trade was likewise firm and inventories have “recovered to appropriate levels” on entry and mid-tier bicycles, according to the supplier.

The cooling off appears to have been most pronounced in Asia, plus the South and Central Americas. As a result inventories were higher.

Shimano described order taking as “brisk” on a wide range of its goods, most notably finishing kit for high-spec road bikes where Dura-Ace and Ultegra kit was required. The Shimano STEPS drive systems remained in demand, though no comment was made on whether supply was being met.

These conditions saw Shimano’s operating income increase by 16.8% to 38,033 million
yen. Gross profit and net sales rose like-for-like, as did the cost of sales. An extraordinary loss attributed to the restructuring announced recently was also marked down.

A revision to first half forecasts has been outlined in response to a depreciation of Asian currencies in Q1 of 2022. For the full year, ordinary income projections were raised 0.9%. A full year revenue projection of 580,000 million yen is 6.1% ahead of last year’s confirmed tally.