Year-to-date revenues increase 33%;
Year-to-date net income increases 26%;
Year-to-date EPS increases to $1.90
CAPE TOWN, South Africa, (November 9, 2022) – Leatt Corporation (OTCQB: LEAT), a leading developer and marketer of protective equipment and ancillary products for many forms of sports, especially extreme high-velocity sports, today announced financial results for the third quarter ending September 30, 2022. All financial numbers are in U.S. dollars.
Third Quarter 2022 Highlights
- Third quarter global revenues of $23.3 million, up 5%, compared to third quarter 2021
- Year-to-date revenues of $65.4 million, up 33%, compared to same period of 2021
- Year-to-date net income of 11.0 million, up 26%, compared to same period of 2021
- Year-to-date EPS increased to $1.90
Chief Executive Officer Sean Macdonald commented: “The 2022 third quarter was our 18th consecutive quarter of year-over-year revenue growth. Total global third quarter 2022 revenues were $23.3 million, an increase of 5% over the third quarter of 2021. Gross profit for the quarter was $10.1 million, up 6% over 2021. Our entire team, as well as our MTB and MOTO customers, remain enthusiastic about the solid momentum and market penetration that the Leatt brand and our ‘head-to-toe’ offering of exceptional protective gear has achieved over the past several years.
“Global revenues for the first nine months of 2022 were $65.4 million, up 33% over the same period last year. Net income for the first nine months grew to $11.0 million, an increase of 26% over the prior year period. That’s a tremendous achievement, compared to the very strong first nine months of 2021 when revenues grew by 91%. We maintained a return on revenue of 17% and earnings of $1.90 per basic share, once again displaying our ability to grow revenues, invest in growth, and remain operationally efficient in these challenging times of macroeconomic headwinds and some stocking congestion globally.
“The increased revenue for the third quarter was primarily due to upticks in sales of helmets and in sales from our other products, parts and accessories category, offset by slight decreases in sales in our body armor and neck brace categories. We were particularly pleased with our results in the U.S. where revenues increased by $1.1 million or 26% over the 2021 third quarter, as we fulfilled pre-booked orders to re-stock dealer inventory around the country. We continue to invest heavily in our U.S. sales and distribution capacity are well stocked in our new U.S. warehouse to meet dealer demand on a on-going basis.
“On a year-to-date basis we saw double digit revenue growth in all our expanding product categories, with the exception of neck braces, our most established product, where sales decreased in the 2022 period, compared to an extraordinary 74% increase in the prior year comparison period as a result of dealer pre-stocking to meet demand. Growth in sales of apparel, MOTO and MTB helmets and off-road motorcycle boots were also encouraging over the 2021 nine-month period.”
Founder and Chairman Dr. Christopher Leatt remarked: “As always, our engineers and designers are dedicated to creating products that protect the riders who use them, and saving lives. Safety is the core of our business.”
Total revenues for the third quarter of 2022 increased to $23.3 million, up 5%, compared to $22.1 million for the third quarter of 2021.
The increase was driven by an 88% increase in helmet sales, and a 38% increase in other products, parts and accessories, that were partially offset by a 15% decrease in body armor and a 30% decrease in neck brace sales.
Income from operations for the third quarter of 2022 decreased to $5.5 million, down 5%, compared to $5.8 million for the third quarter of 2021.
Net income for the third quarter of 2022 decreased to $4.1 million, or $0.70 per basic and $0.65 per diluted share, down 5%, compared to $4.3 million, or $0.79 per basic and $0.69 per diluted share, for the third quarter of 2021.
Leatt continued to meet its working capital needs from cash on hand and internally generated cash flow from operations. At September 30, 2022, the Company had cash and cash equivalents of $4.8 million and a current ratio of 3.1:1.
Mr. Macdonald added: “We continue to grow despite the macroeconomic geo-political headwinds that have caused currency fluctuations and have impacted the sentiment of customers and consumers around the world. We are seeing some moderation in the extraordinary consumer demand levels that the global MOTO and MTB industry have enjoyed over the last several quarters, but these headwinds do not change the overall strategy and solid fundamentals that have contributed to our success. Consumers continue to ride and participate heavily in outdoor activities, and dealers continue to digest inventory and re-order. These are trends we that expect to continue.
“In the U.S., our Reno, Nevada warehouse is now fully up and running and well-stocked to ship products to customers and consumers efficiently. The U.S. sales team continues to grow substantially as we reach and service a wider group of MOTO and MTB dealers around the country.
Internationally, our team of global sales and marketing managers in some of our most important regions continues to be an important focus as we aim to leverage the momentum that the Leatt brand has gained over the last several years and grow our multi-channel sales approach.
“We remain proud of our operational efficiencies, resilience and ability to control costs, despite the strong global inflationary environment. We believe that the sales traction, market penetration and brand development that we have achieved over the last several years are testament to our team’s ability to develop, market and sell innovative products to wider groups of consumers all over the world. Many of our innovative products are still in their infancy, in terms of market share, with significant opportunity for further gains, and we believe that we are well-positioned to deliver long-term growth and shareholder value.
The Company will host a conference call at 10:00 am ET on Wednesday, November 9, 2022, to discuss the third quarter 2022 results.
Participants should dial in to the call ten minutes before the scheduled time, using the following numbers: 1-877-407-9716 (U.S.A) or +1-201-493-6779 (international) to access the call.
There will also be a simultaneous live webcast through the Company’s website, www.leatt-corp.com. Participants should register on the website approximately ten minutes prior to the start of the webcast.
An audio replay of the conference call will be available for seven days and can be accessed by dialing 1-844-512-2921 (U.S.A) or +1-412-317-6671 (international) and using passcode 13733893.
For those unable to attend the call, a recording of the live webcast will be archived shortly following the event for 30 days on the Company’s website.
About Leatt Corp
Leatt Corporation develops personal protective equipment and ancillary products for all forms of sports, especially extreme motorsports. The Leatt-Brace® is an award-winning neck brace system considered the gold standard for neck protection for anyone wearing a crash helmet as a form of protection. It was designed for participants in extreme sports or riding motorcycles, bicycles, mountain bicycles, all-terrain vehicles, snowmobiles and other vehicles. For more information, visit www.leatt.com.
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This press release may contain forward-looking statements regarding Leatt Corporation (the “Company”) within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact included herein are “forward-looking statements” including statements regarding: the likelihood that the Company’s momentum of record-breaking revenue growth will continue; the ability of the Company to continue to maintain its innovative and cutting edge pipeline of branded products or to financially benefit from its sales and marketing efforts; the ability of the Company’s global supply chain to withstand any adverse impact on global supply chains and to meet customer demand; the financial outlook of the Company; the general ability of the Company to achieve its commercial objectives; the business strategy, plans and objectives of the Company and its subsidiaries; and any other statements of non-historical information. These forward-looking statements are often identified by the use of forward-looking terminology such as “believes,” “expects,” “anticipates,” “seeks,” “should,” “could,” “intends,” or “projects” or similar expressions, and involve known and unknown risks and uncertainties. These statements are based upon the Company’s current expectations and speak only as of the date hereof. Any indication of the merits of a claim does not necessarily mean the claim will prevail at trial or otherwise. Financial performance in one period does not necessarily mean continued or better performance in the future. The Company’s actual results in any endeavor may differ materially and adversely from those expressed in any forward-looking statements as a result of various factors and uncertainties, which factors or uncertainties may be beyond our ability to foresee or control. Other risk factors include the status of the Company’s common stock as a “penny stock” and those listed in other reports posted on The OTC Markets Group, Inc.