Asics reported that despite strong sales in North America, net sales fell 1.1% to 105,329 million yen ($822 million) due to production disruptions caused by the closure of some factories. . In North America, sales increased 12.2% to 21,112 million yen ($165 million).

The gains in North America were driven by strong sales in the Performance Running category and the Core Performance Sports category. The North America segment loss amounted to 774 million yen mainly due to a deterioration in the gross margin rate caused by the increase in logistics costs and the increase in selling, general and administrative expenses resulting from the rise in e-commerce sales.

In other regions, sales in Japan decreased 11.7% to 26,933 million yen due to weak sales in all categories.
Segment revenue decreased by 42.6% to 1,447 million yen, mainly due to the impact of lower
net sales.

Net sales in Europe decreased 0.7% to 30,894 million yen due to weak sales of the Sports Style category and the Onitsuka Tiger category. The segment’s revenue decreased by 26.3% to 4,052 million yen, mainly due to a deterioration in the gross margin rate and the increase in advertising expenditure.

Net sales in Greater China were 13,579 million yen, flat year-on-year, due to weak sales of the Onitsuka Tiger category despite strong sales of the Performance Running category. The segment’s revenue increased by 4.3% to 3,621 million yen, mainly due to an improvement in the gross margin rate of wholesale and retail products.

In the Oceana region, net sales decreased 4.1% to 7,364 million yen due to weak sales in all categories other than the Performance Running category. Segment revenue increased 2.2% to 1,447 million yen, mainly due to improved gross margin
report.

In the Southeast and South Asia regions, net sales increased 45.3% to 3,641 million yen due to strong sales of the Performance Running category and the Onitsuka Tiger category. Segment revenue increased significantly by 280.6% to 629 million yen due to an improvement in the gross margin rate, as well as mainly due to the increase in net sales.

In other regions, net sales increased 23.0% to 9,227 million yen due to strong sales of Performance Running category and Sports Style category. Segment revenue increased 73.9% to 715 million yen, mainly due to the impact of higher net sales.

Company-wide, profit attributable to parent company owners decreased 16.8% to 8,725 million yen, mainly due to the impact of lower net sales and profit.

Gross margin decreased by 1.1% to 52,601 million yen due to the impact of lower net sales. Operating income decreased by 31.1% to 10,057 million yen, mainly due to an increase in commissions, as well as lower net sales. Ordinary income fell 25.3% to 11,000 million yen.

Asics wrote in its statement: “While there are concerns regarding the various effects of the novel coronavirus (COVID-19) this quarter, efforts to normalize socio-economic activities are underway in many parts of the world. Production impacted by the spread of COVID-19 last year, the shortage of products in this first quarter has already been taken into account in the plan. Despite logistical disruptions in various regions and the impact of the lockdown in Shanghai and other regions, net sales remained at the same level as the same period a year earlier. However, net sales exceeded our plan. In these circumstances, there has been confusion about the situation in Russia and Ukraine. However, the scale of Asics’ operations in Russia and Ukraine is small and the impact on business performance has been minimal.

By category:

• Running performance: Net sales increased 7.9% to 58,779 million yen due to strong sales in all regions other than Japan. The category’s profit fell 7.5% to 13,285 million yen, mainly due to a lower gross margin rate.
• Basic performance sports: Net sales decreased by 24.7% to 10,223 million yen, mainly due to the impact of the closure of certain factories. The category’s profit fell 49.6% to 1,540 million yen, mainly due to the impact of lower net sales.
• Sporty styling: Net sales decreased by 8.2% to 8,117 million yen, mainly due to the impact of the closure of certain factories. The category’s profit fell 20.7% to 1,345 million yen, mainly due to the impact of lower net sales, despite an improvement in the gross margin ratio.
• Clothing and equipment: Net sales were 8,733 million yen, flat year-on-year, due to strong sales in all regions other than Japan. The category’s profit fell 69.9% to 175 million yen due to the impact of lower gross margin rate and higher selling, general and administrative expenses.
• Onitsuka Tiger: Net sales fell 11.6% to 8,735 million yen due to lower sales in the Greater China region, affected by the lockdown in Shanghai and other regions. The category’s profit fell 9.2% to 1,852 million yen, mainly due to the impact of lower net sales, despite an improvement in the gross margin ratio.

Asics maintained its guidance for the year. Sales are expected to reach 420,000 million yen, up 3.9%. Operating profit is expected to be 23 trillion yen, a gain of 4.8%. Net profit is expected to reach 13,500 million yen, up 43.6%.

Photo courtesy of Asics