JAKKS Pacific Reports Record Second-Quarter Results
Reaffirms Revenue and Earnings Forecast for Balance of Year
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MALIBU, Calif.--(BUSINESS WIRE)--July 19, 2001--JAKKS Pacific Inc. (Nasdaq: JAKK - news) today reported record sales and net income for the second quarter ended June 30, 2001.
Net sales were $70.1 million compared to $50.6 million in the second quarter of 2000, an increase of 38.7%. Net income was $6.9 million, or $0.36 per diluted share, compared to second-quarter 2000 net income of $6.2 million, or $0.31 per diluted share, an increase of 16.1% per share.
``We are pleased to have produced these record results despite a slowdown in the traditional toy business that has affected both manufacturers and the retailing sector alike,'' said Jack Friedman, chairman and CEO of JAKKS Pacific. ``We attribute these results to a number of factors, notably the growing contribution of our Pentech® brand, which was acquired last July and is proving to be a great addition to our Flying Colors® division. These results also point to the success of our mass merchant partners in marketing our existing and emerging evergreen brands, and to our success in carefully monitoring and meeting their inventory and margin requirements.
``We anticipate that for the third quarter we will report net sales of $90 to $100 million, net income of $9.3 to $11.2 million, and earnings per diluted share of $0.48 to $0.58,'' said Friedman. ``Our previously announced forecast for the year remains essentially unchanged, although current expectations are that we will come in at the high end of the range.'' JAKKS has previously said that it expects full year sales of $290 to $310 million, net income of $30 to $32 million, and earnings per diluted share of $1.61 to $1.71.
For the six months ended June 30, 2001, net sales were $130.1 million compared to $101.4 million in the same period a year ago. Net income was $12.9 million, or $0.67 per diluted share, compared to net income of $12.8 million, or $0.63 per diluted share, in the first six months of 2000, which included a profit of $6.8 million from the company's joint venture for World Wrestling Federation® video games with THQ, while in the first six months of 2001 the joint venture contributed a profit of only $0.9 million.
Stephen Berman, the company's president and COO, noted that as in the first quarter, lower joint venture profits from the company's WWF video games during the industry's transition to new platforms -- notably Microsoft's ``Xbox'' and Nintendo's ``GameCube'' -- that are not expected to be available at retail until the fourth quarter at the earliest. ``Accordingly,'' said Berman, ``joint venture profits for the balance of the year are expected to be substantially below those of the comparable period of 2000, but will not impact our 2001 forecast of $1.61 to $1.71 per share.
``We anticipate that 2002 will be another record year for JAKKS,'' Berman continued. ``We base this in part on our continuing efforts to organically develop new and exciting products, many of which are scheduled for introduction in the coming months. In addition, we believe we will have increasing acquisition opportunities, as well as our ongoing efforts to identify attractive acquisition candidates that will complement our existing product lines and will contribute to our profitability. We are also confident that profits from our video game joint venture will be substantially higher in 2002.''
Berman concluded: ``With an exceptionally strong balance sheet, including $49.7 million in cash and marketable securities, net liquid assets of $74.9 million and with virtually no debt, we remain well positioned to continue our execution of these initiatives.''
JAKKS will conduct a teleconference in conjunction with this release. It will begin at 8 a.m. PDT (11 a.m. EDT), July 19, 2001. One may listen to the call via the Internet at jakkspacific.com. For those unable to attend, a playback of the call will be available from 10 a.m. PDT (1 p.m. EDT) on July 19 through 5 p.m. PDT (8 p.m. EDT) on July 20. You may access the playback by calling 800/645-7401 (international callers, 402/220-0250). |
