Looking ahead, Spin Master said it would be expanding its toy portfolio with innovation, driving its franchises and building its licensed partner portfolio.
Spin Master has announced its financial results for the three months and year ended December 31st, 2022.
The company posted a drop in revenue in its latest quarter, driven by a decline in toy sales, with a Q4 loss of $13.8m, compared with a profit of $26.5m for the same period a year earlier. Revenue dropped 25% to $465.8m, in line with management expectations.
Spin Master’s revenue from sales of toys fell 27% to $396.7m during the winter holiday quarter, down from sales of $552.4m million in the prior quarter. The digital games division saw a 24% decline in revenue, while the entertainment business achieved revenue growth of 10%.
“Our commitment to reimagining everyday play across our three creative centres resulted in Constant Currency Revenue growth for 2022 and propelled Spin Master to the become the 4th largest toy manufacturer globally, against the backdrop of challenging economic and retail dynamics,” said Max Rangel, Spin Master’s Global president & CEO.
“Entering into 2023, we are expanding our core toy portfolio with innovation, driving our franchises and building our licensed partner portfolio. 2023 will be one of our biggest years in terms of entertainment content releases, showcasing our diversified content pipeline including our second Paw Patrol movie, Paw Patrol: The Mighty Movie; our first Paw Patrol spin-off, Rubble & Crew; as well as the debuts of our two new animated series, Vida the Vet and Unicorn Academy. We will also introduce several new digital play experiences, including the launch of a Rubik’s digital game and our first in-house Paw Patrol digital game.”
The company said it expected to face continued macroeconomic headwinds and was focused on managing its operational costs, positioning Spin Master to thrive.
Max added: “from a strategic perspective, we continue to build franchises across toys, entertainment and digital games, applying our signature innovation, investing in key organizational capabilities and pursuing acquisition opportunities to attract new fans, reach new audiences and engage new players in order to further solidify our leadership in children’s entertainment and deliver profitable growth now and into the future.”
Mark Segal, chief financial officer, added: “Our financial discipline and focus on managing pricing and costs effectively drove strong gross and operating margins, despite challenging operating conditions in the second half of 2022. Our focus on managing working capital and generating cash flow allowed us to end the year with available liquidity in excess of $1.1b. We remain in a very strong financial position with the ability to continue investing in innovation, geographic expansion and acquisitions to drive growth.”