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Playmates Toys Ltd., of Teenage Mutant Ninja Turtle fame, trades on
the Hong Kong market and on the Pink Sheets in the US (ca. US$.24).
The company emerged from near bankruptcy in 1987 to become, on
the strength of the phenomenally successful Turtle franchise, one
of the world's leading toy companies. Indeed, for 1990, Playmates
Toys earned the staggering sum of US$154 million net profit, which
exceeded the profits of Hasbro, Mattel, Tyco Toys, and Galoob Toys
combined! Indeed, Playmates was the first toy company in the world
ever to report profits of over US$100 million for any given year.
Playmates Toys has since built on its success, but, of course, it was
entirely unreasonable to expect that the company could sustain that
torrid pace of profits. The company has since diversified its product
line, but profits have suffered as Playmates experimented with new
toy lines and set up a subsidiary to exploit the game video market.
The company is now poised, I believe, for another ride on the
merry-go-round and another grab for the brass ring. This November 15,
with much fanfare, the movie "Space Jam" with Michael Jordan, Charles
Barkley, and other NBA stars will debut. The movie will also feature
all the well known Warner Bros. animated characters (Bugs Bunny,
Daffy Duck, Tweety, Yosemite Sam, etc.) in a clever fusion of live
action and animation. Playmates has the toy license for this potential
blockbuster as well as the toy license for the upcoming remake of the
"Flash Gordon" series for the silver screen.
Among other properties, Playmates owns the exclusive license for Star
Trek action figures and accessories. A new Star Trek movie this year
will no doubt stimulate an already very popular and profitable seller.
Playmates also has a hit toy line with "Primal Rage" action
figures and builds on the great popularity of the game video of the
same name, which title will incarnate as the eagerly awaited
"Primal Rage II". Playmates Toys' subsidiary, Playmates Interactive
Entertainment, heretofore, introduced a very successful game video,
Earthworm Jim, and now has many other titles, which the critics are
currently quite excited about. (Cf. VMX Racers, Skeleton Warriors,
Burning Road, Into the Void, Powerslave, etc.) To add icing to the
cake, Playmates will doubtless benefit from a fourth "Turtle"
movie later this year. The still popular Turtle line will celebrate
its tenth year in 1997. Furthermore, Playmates took the doll world
by storm in the last years with its highly successful "Waterbabies"
and acclaimed "Baby So Beautiful" line.
The point is that with the costs of its restructuring and diversification
behind it and the prospects of very successful promotional properties
before it, Playmates Toys' currently depressed stock price stands
to get a likely boost. Also worthy to note, the company has recently
hired upper level managers who left Mattel, Hasbro, and Galoob
for what they perceived as better opportunities with Playmates Toys,
Inc., the US division of Playmates Toys, Ltd. based in California.
This seems to suggest that Playmates is making bold plans for its
future.
There are 660 million shares issued. The Chan family of Hong Kong
controls 70%. The company has paid variable dividends since 1989.
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