Shimano’s sales for the first nine months of the year were down by 2.0 percent from the year-ago period to 264,174 million yen (€2.16bn-$2.53bn), hampered by lockdowns around the world in response to Covid-19. However, sales started to improve during the second quarter due to the soaring popularity of cycling when lockdown restrictions eased. The company managed to increase profits, with net earnings gaining 10.4 percent to ¥47,231 million (€386.5m-$453.3m).

The gross margin inched up by 0.9 percentage points to 39.9 percent and the operating income gained 7.7 percent to ¥54,300 million (€444.4m-$521.2m).

In the bicycle components segment, Shimano’s revenues fell by 3.8 percent to ¥204,499 million (€1.67bn-$1.96bn) but operating earnings rose by 4.9 percent to ¥44,131 million (€361.2m-$423.6m).

The group said that the demand for bicycles began to rapidly increase all over the world from early spring, as cycling was widely adopted as a form of recreation and exercise, as well as a mode of transportation with a lower risk of infection. In addition, centering around Europe, subsidies to encourage the purchase of bicycles and policies to build infrastructure such as bike lanes have contributed to the cycling boom. Under such circumstances, retail sales of bicycles and bicycle-related products recovered dramatically in overseas markets including Europe, North America and China. As supply could often not keep up with the rapid increase in demand, each country saw shortages in distributor inventories. In the Japanese market, although there were no evident signs of a large cycling boom, retail sales for cross bikes and for e-bikes remained solid. The new Deore MTB components continued to do well.

The group’s fishing tackle segment performed better, with sales rising by 5.0 percent to ¥59,425 million (€486.3m-$570.4m), and operating income increasing by 22.3 percent to ¥10,263 million (€84.0m-$98.5m). The company said that fishing was also popular after the end of lockdowns; with the number of new customers increasing in Japan. Sales of mid-range and popular-priced products were especially favorable. Overseas, on the back of a rapid increase in demand for fishing products, sales of medium- and high-priced products grew in North America. Sales performed well in both the U.K. and Italy, which are major markets in Europe, owing to strong demand. In Asia, sales in Southeast Asian countries showed signs of a recovery. The company’s Zodias rods and the spinning reels Vanford and Saragosa proved popular.

In the Others segment, Shimano’s sales declined by 7.5 percent to ¥248 million (€2.0m-$2.4m). The operating loss in this segment expanded to ¥95 million (€0.8m-$0.9m) from ¥61 million.

For the full year, the company forecasts sales of ¥350,000 million (€2.86bn-$3.36bn), down from last year’s ¥363,230 million. However, net income should progress from ¥51.8 million (€0.4m-$0.5m) to ¥64.3 million.