"Over the past several months numerous new products have been introduced, in both our Juvenile and Home Furnishings Segments"
Dorel CEO Martin Schwartz

Dorel Industries Inc.(DIIB) announced a record quarter in sales citing continued organic growth at Dorel Juvenile Group USA. Total revenues for the first quarter ended March 31, 2004 were up 41.5% to US$391.8 million, compared to US$276.9 million posted a year ago.

First quarter sales underline the positive results of Dorel's intensive, on-going product development efforts. "Over the past several months numerous new products have been introduced, in both our Juvenile and Home Furnishings Segments. This has particularly augmented juvenile sales in the United States, continuing the marked improvement which began during the fourth quarter of 2003. The biggest issue of the quarter was high particle board prices and their impact on ready-to-assemble furniture margins. We foresee improvement going forward as the RTA furniture industry implements higher selling prices," commented Mr. Schwartz.

As previously announced, the Company is recording a charge in the amount of US$6.5 million pre-tax due to a dispute with one of its insurance carriers over the aggregate amount of insurance available to the Company, including one claim that came due this month. This amount is equivalent to a US$0.13 per share after-tax impact. After accounting for this expense, earnings were US$19.6 million or US$0.60 per share, compared to US$19.2 million or US$0.60 per share for the first quarter of 2003. Excluding this charge, earnings for the first quarter would have been US$23.9 million or US$0.73 per share.

As a result, Dorel is reducing its guidance for fiscal 2004 by US$0.13 per share, to earnings of between US$3.12 to US$3.22 per share.

Dorel is initiating legal action against TIG Specialty Insurance Solutions, a subsidiary of Fairfax Financial Holdings Inc. "We anticipate a favourable decision and any recovery will be included in our net income in future periods," stated Mr. Schwartz.