STOCKHOLM (BRAIN) — Continuing decreased bike helmet demand contributed to MIPS' net sales declining 51% year-over-year in the second quarter.
The helmet-technology company's net sales for the quarter ending in June were SEK 102 million ($9.9 million) compared with SEK 206 million at the same time last year. President and CEO Max Strandwitz said bike helmet customers were cautious at the start of the quarter because inventory levels remained high. Demand gradually grew afterward, he said.
"The inventory situation is still unbalanced for our customers and retailers around the world, with an excess of inventory of helmets at lower price points," Strandwitz said. "On the positive side, we note that on most markets, the inventory levels have returned to historic levels for helmets at medium and higher price points. The unbalanced inventory situation continues to be a challenge for our customers and resellers due to how it impacts their cash flow, which also makes them more restrictive when it comes to purchasing large volumes of new products."
MIPS attended Eurobike last month, and Strandwitz said exhibitors there shared the same view: "It has been four challenging quarters, and markets in general will continue to be volatile for a while longer, but the bike market will return to growth going forward and everybody is preparing for this upturn in the market. We also find it reassuring that three long-term trends from the market are evident; cycling will continue, the use of bicycle helmets increases daily, and the interest for better helmet solutions has an impact on what consumers are looking for."
Net income was SEK 20 million for the quarter, down 75% from SEK 80 million year-over-year. Earnings per share was down by the same percentage, from SEK 3.04 to SEK 0.76.
MIPS' corporate headquarters is in Stockholm, and its stock is traded on the Stockholm Stock Exchange under the MIPS symbol. Stock quote at Marketwatch.com.
