Revenue increased 25.5% while adjusted EBITDA saw a 40.4% increase.
The results show that the company’s revenue has increased 25.5% to $285.7m, up from $227.7m, while gross product sales increased 25.7% to $288m, compared to $229.1m, driven by sales of Hatchimals, Luvabella and the games portfolio including Cardinal. This growth has more than offset declines in Air Hogs and Zoomer.
Gross product sales in the boys action and high-tech construction segment increased 27.1% in Q1, primarily due to increased in sales of Tech Deck as well as Flush Force, offset by decreased sales of Minecraft and Pirates of the Caribbean licensed products.
Gross product sales in the pre-school and girls segment decreased 2.5% in Q1, with higher sales of Paw Patrol more than offset by lower sales of Teletubbies and Power Puff Girls licensed products. Gross product sales in the outdoor segment increased 8.9% in Q1.
Net income has been reduced by the impact of a bad debt expense from Toys R Us, and is now at $8.7m, or $0.09 per share, compared with US$10.1m, or US$0.10 per share in Q1 2017. However, gross profit increased 31.3% to $148.8m, representing 52.1% of revenue, compared with US$113.3m, or 49.8% of revenue in Q1 2017.
Ronnen Harary, Spin Master’s chairman and Co-CEO, commented: “Spin Master delivered very strong Q1 2018 financial results characterised by record revenue and profitability. Our results not only reflect our innovative products and brands resonating with consumers but they are also a testament to the team’s effort in effectively managing the business through the industry-wide disruption caused by the Toys R Us US liquidation.”
He continued: “Our entertainment properties continue to be major drivers of growth and we have some exciting new themes, formats and content to introduce in 2018 and 2019. We are particularly pleased to have closed the Gund acquisition, and are looking forward to driving Gund’s global growth potential as well as leveraging its plush expertise in Spin Master’s business.”