JAKKS Pacific, Inc. : Reports Third Quarter 2013 Financial Results
10/23/2013 | 06:04am EDT
JAKKS Pacific, Inc. (NASDAQ: JAKK) reported results for the Company's
third quarter ended September 30, 2013.
Net sales for the third quarter of 2013 were $310.9 million compared to
net sales of $314.5 million reported in the comparable period in 2012.
The reported net income for the third quarter was $36.6 million, or
$1.11 per diluted share, which reflects the net dilutive impact of $0.21
per diluted share associated with the common shares underlying the
$100.0 million convertible senior notes recently issued and repurchased
in July 2013. This compares to net income of $30.4 million, or $1.10 per
diluted share, reported in the comparable period in 2012.
Net sales for the nine months ending September 30, 2013, were $495.2
million compared to $533.3 million in 2012. The reported net loss for
the nine month period was $37.8 million, or $1.73 per diluted share,
which includes charges for license minimum guarantee shortfalls of $14.4
million and inventory impairment of $14.9 million. This compares to net
income for the first nine months of 2012 of $14.7 million, or $0.59 per
diluted share, which included $4.1 million, or $0.10 per diluted share,
of pre-tax financial and legal advisory fees and expenses related to an
unsolicited indication of interest that ended.
Stephen Berman, President and CEO of JAKKS Pacific stated, "We are
pleased with our financial results for the third quarter during which we
completed our $100 million convertible senior note financing. During the
quarter, we sold a broad array of products including Disney Princess
dolls, dress up and role play, Sofia the First dress up and role play
items, Disguise Halloween costumes, 31" Giant Action Figures,
foot-to-foot ride-ons and kids furniture."
Mr. Berman continued, "We recently completed our Fall Toy Preview
meetings and are pleased with the enthusiastic response from retailers,
licensors and other industry partners to our 2014 product line-up,
particularly the reaction to our new line of technology-driven toys. We
anticipate these toys will provide children with a new and heightened
play experience by combining our strong line-up of physical toys with
DreamPlay iD technology and enhanced augmented reality content, all of
which will come together in new and exciting Apps. Our 'Ariel's Musical
Surprise' app launched this month for iOS devices and is ready for use
with our Disney Little Mermaid products which are now available at
retail. In 2014, we will be rolling out additional innovative lines of
toys delivering this unique experience.
"Looking ahead to 2014, as JAKKS approaches its 20th year in business,
we are looking forward to returning JAKKS to profitability. We expect to
achieve this by continuing to offer new and exciting products,
continuing to spend on technology and content, and by realizing the
benefits of our previously announced restructuring plan, which has
resulted in the reduction of our head count of employees and will reduce
leased space and other overhead expenses," Berman concluded.
The Company currently anticipates net sales for the full year of
approximately $620.0 million, with a loss per share, as previously
announced, of approximately $56.1 million, or $2.56 per diluted share.
JAKKS Pacific will webcast its third quarter earnings conference call
today, October 23, 2013, at 9:00 a.m. ET (6:00 a.m. PT). To listen to
the live webcast, go to www.jakks.com/investors,
and click on the earnings webcast link under Events and Presentations
at least 10 minutes prior to register, download and install any
necessary audio software. A telephonic playback will be available from
11:00 a.m. ET on October 23 through November 22, 2013. The playback can
be accessed by calling 1 (888) 843-7419 or 1 (630) 652-3042 for
international callers, pass code "3587 3671".
About JAKKS Pacific, Inc.
JAKKS Pacific, Inc. (NASDAQ: JAKK) is a leading designer and marketer of
toys and consumer products with a wide range of products that feature
popular brands and children's toy licenses. JAKKS' diverse portfolio
includes Action Figures, Electronics, Dolls, Dress-Up, Role Play,
Halloween Costumes, Kids Furniture, Vehicles, Plush, Art Activity Kits,
Seasonal Products, Infant/Pre-School, Construction Toys, Ride-On
Vehicles, Wagons, Inflatable Environments and Tents, Impulse Toys and
Pet Products sold under various proprietary brands including JAKKS
Pacific®, Creative Designs International TM, Road Champs®, Funnoodle®,
JAKKS Pets TM, Plug It In & Play TV Games TM, Kids Only!®, Tollytots®,
Disguise®, Moose Mountain® and Maui®. JAKKS is also the creator of the
underlying Monsuno® property and toy line. JAKKS is an award-winning
licensee of several hundred nationally and internationally known
trademarks including Nickelodeon®, Warner Bros.®, Ultimate Fighting
Championship®, Hello Kitty®, Graco® and Cabbage Patch Kids®. DreamPlay
Toys, LLC is a joint venture between JAKKS Pacific, Inc. and NantWorks
LLC to develop, market and sell toys and related consumer products
incorporating NantWorks' proprietary iD image recognition technology. www.jakks.com
About DreamPlay Toys, LLC
JAKKS Pacific, Inc. and NantWorks LLC formed DreamPlay Toys, LLC, a
joint venture company to develop, market and sell toys and related
consumer products incorporating NantWorks' proprietary iD image
recognition technology. This novel technology enables the consumer to
instantly link a physical toy to interactive content, including video,
animation and games using a smart phone or tablet device to instantly
bringing the toy to life. JAKKS Pacific plans to introduce a broad
product line, which will combine this revolutionary technology with
exciting new content, including augmented reality, leaving consumers
with a memorable and entertaining experience. JAKKS Pacific and
NantWorks have also formed DreamPlay LLC, in order to extend image
recognition technology to non-toy consumer products and applications.
This press release may contain forward-looking statements (within the
meaning of the Private Securities Litigation Reform Act of 1995) that
are based on current expectations, estimates and projections about JAKKS
Pacific's business based partly on assumptions made by its management.
These statements are not guarantees of future performance and involve
risks, uncertainties and assumptions that are difficult to predict.
Therefore, actual outcomes and results may differ materially from what
is expressed or forecasted in such statements due to numerous factors,
including, but not limited to, those described above, changes in demand
for JAKKS' products, product mix, the timing of customer orders and
deliveries, the impact of competitive products and pricing, and
difficulties with integrating acquired businesses. The forward-looking
statements contained herein speak only as of the date on which they are
made, and JAKKS undertakes no obligation to update any of them to
reflect events or circumstances after the date of this release.