The company saw a 10.02% decrease in sales compared to the same period last year.
“As expected, our results for the second-quarter showed the effect of declines in products that contributed strongly to results in the second quarter of last year,” said Stephen Berman, CEO. “We saw strong growth in our Disguise, Halloween costume business, and strong contributions from toys tied to several new theatrical releases, including Aladdin, Godzilla and Toy Story 4, but these were more than offset by the declines in toys tied to Incredibles 2 and our Squish Dee Lish products. As we have noted before, our sales this year have been shifted to the second half as a result of the timing of several films and television shows, notably Frozen II, as well as Toy Story 4, the 30th Anniversary of the release of Disney’s The Little Mermaid and Disney Jr.’s Gigantosaurus animated TV series.”
Despite low profit margins, management stated that the company is trying to improve adjusted EBITDA in 2019.
Stephen continued: “We remain confident that our second half sales will show renewed strength, as the disruptions caused by Toys R Us’ liquidation in the United States no longer weigh down the industry. This, coupled with the recently announced recapitalisation transaction to strengthen our balance sheet, provides a clearer pathway to the future here at Jakks.”