CAPE TOWN, South Africa (BRAIN) — Leatt Corporation's first-quarter revenues dropped 19% year-over-year as the cycling and motorcycle protective brand's dealers and distributors continue to deal with excessive inventory levels.
"We remain focused on our margins, which decreased in the first quarter, largely due to short-term promotional opportunities at the dealer-direct level, particularly in the United States, as we successfully turn slower moving inventory to cash that will fuel future growth," said CEO Sean Macdonald. "We do expect our margins to improve as we release our exciting new products globally and inventory levels continue to stabilize."
Revenue for the quarter ending March 31 was $10.6 million, compared with $13 million at the same time last year. Net loss was $816,679, down 180% from profits of $1.02 million year-over-year. Earnings per share for the quarter decreased from plus $0.17 to minus $0.13.
"Although sales to our global distributors decreased by 31% as our distributors continue to manage industry-wide stocking dynamics, consumer-direct sales increased by 15% and dealer-direct sales increased by 9%," Macdonald said. "Domestic and South African dealer direct sales to both Moto and MTB dealers also grew during the quarter, a very encouraging trend and testament to the gradual recovery that we believe will filter through to distribution over the next several quarters."
Leatt is traded on the OTCQB markets under the LEAT symbol.
