ROTH Capital Partners Infant, Juvenile & Toy Conference December 14, 2010
MARTIN SCHWARTZ President & Chief Executive Officer 2
Forward Looking Statements Except for historical information provided herein, this presentation may contain information and statements of a forward looking nature concerning the future performance of Dorel Industries Inc. These statements are based on suppositions and uncertainties as well as on management's best possible evaluation of future events. The business of the Company and these forward looking statements are subject to a number of risks and uncertainties that could cause actual results to differ from expected results. Important factors which could cause such differences may include, without excluding other considerations, increases in raw material costs, particularly for key input factors such as particle board and resins; increases in ocean freight container costs; failure of new products to meet demand expectations; changes to the Company s effective income tax rate as a result of changes in the anticipated geographic mix of revenues; the impact of price pressures exerted by competitors, and settlements for product liability cases which exceed the Company s insurance coverage limits. A description of the above mentioned items and certain additional risk factors are discussed in the Company s Annual MD&A and Annual Information Form, filed with the Canadian securities regulatory authorities. The risk factors outlined in the previously mentioned documents are specifically incorporated herein by reference. The Company s business, financial condition, or operating results could be materially adversely affected if any of these risks and uncertainties were to materialize. Given these risks and uncertainties, investors should not place undue reliance on forward looking statements as a prediction of actual results. Note: All figures are in US dollars. 3
Dorel At a Glance 2009 Revenues Juvenile $1 billion Recreational/Leisure $680 million Home Furnishings $465 million Total $2.1 billion 4
Juvenile Segment Geographic Distribution of Sales (by customer) 2009 4% 2008 2% 27% 29% 6% 63% 6% 63% US CANADA EUROPE OTHER 5
Juvenile Segment Global Leader in Car Seats 6
Juvenile Segment Baby Equipment 7
Juvenile Segment (In Millions of US $) Dorel Juvenile 2006 2007 2008 2009 2010 9 months Sales $889 $1,017 $1,074 $995 $794 Gross Profit $264 $309 $310 $274 $217.2 Juvenile Consolidated Earnings From Operations Financials $92 $113 $127 $93 $80.5 EBITDA $122 $145 $160 $129 $107.4 8
Juvenile Segment Dorel Europe Brand Portfolio Brand Price Range Top 8 Countries* HPP / HPP+ 60% Carseats & Strollers/ Equipment/ Small Nusery HPP / MPP+ 60% Carseats /Strollers/ Equipment/ Home Safety MPP / OPP+ 14% OPP / Private Label OPP 26% * Interconnection data 2008 9
Juvenile Segment Innovation Europe Elea features a unique two step compact to super compact folding technology FeroFix an easy in and out car seat for children aged 3 to 12 Opal the first car seat that can be either rear or front facing, yet does not require a change in belt routing 10
Juvenile Segment DJG NA Brand Portfolio US Price Range HPP / HPP+ MPP MPP OPP / OPP+ 11
Juvenile Segment A revolutionary system that shields the occupant s head and reduces impact forces through the precise release of air. 30% reduction in neck forces 50% reduction in neck rotation 30% reduction in peak forces to the head 12
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Juvenile Segment 2007 Dorel Australia 2009 Dorel Brazil Dorel Brazil Local manufacturing facilities Proven potential 14
Juvenile Segment Brazilian Quick Facts Population in 2009: 194 million (world s fifth largest) 52% of population is middle class (2008) 2009 # of births: 3.6 million Enforced use of car seats children 0 7 years Significant sales / earnings gains Strong future 15
Recreational/Leisure Segment Global Innovation Leader in the Bicycle Industry 2004 Pacific Cycle 2008 Cannondale Unmatched range of brands/products through a robust range of channels Positioned for significant long term growth and value creation. Leveraging the power of Dorel 16
Recreational/Leisure Segment Global Presence Cannondale: 79 countries GT: 45 countries Mongoose: 51 countries Schwinn: 33 countries 17
Recreational/Leisure Segment Strategic and Comprehensive Portfolio 18
Recreational/Leisure Segment Historical Financials 2006 thru 2009 (In Millions of US$) 2006 2007 2008 2009 2010 9 months Sales 340.7 374.8 656.6 681.4 569.1 Gross Profit 64.0 73.0 150.8 153.7 137.1 Earnings from Operations 26.0 33.0 41.9 39.8 41.7 EBITDA 27.1 34.7 48.8 46.9 48.9 Note: 2007 & Prior do not include sales made by Dorel Distribution Canada 19
Recreational/Leisure Segment Sports Marketing Road Racing 20
Three Year Performance (in millions of US$, other than EPS) 2009 2008 2007 Revenue $ 2,140.1 $ 2,181.9 $ 1,813.6 Pre tax income 128.3 132.0 106.6 Net income 107.2 112.9 87.5 EPS (diluted) 3.21 (1) 3.38 (2) 2.63 21
Nine Months (ended September 30) 3 months (3 rd quarter) (in thousands of US$, other than EPS) 2010 2009 Revenue $ 569,455 $ 518,458 Net income 30,119 30,230 EPS (diluted) 0.91 0.91 9 months (in thousands of US$, other than EPS) 2010 2009 Revenue $ 1,773,463 $ 1,594,811 Net income 102,617 83,023 EPS (diluted) 3.09 2.49 22
Why Invest in Dorel? Investing to create opportunities Continuous product innovation Strong, known brands Depth of management Recession resistant products Generate significant free cash flow Pay a quarterly dividend Majority of Dorel Board is comprised of independent Directors with finance, international retail and public company experience Dorel s performance best ever, despite economic downturn 23
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