Reason for JAKKs sell-off (bolding mine):
Tuesday September 19, 1:17 pm Eastern Time
Press Release
JAKKS Pacific Announces Preliminary Results for
Third Quarter 2000
MALIBU, Calif.--(BUSINESS WIRE)--Sept. 19, 2000--JAKKS Pacific, Inc. (Nasdaq NM:JAKK - news) today reported preliminary results for the third quarter ended Sept. 30,
2000.
Net sales for the third quarter are expected to range from $90 million to $95 million, and net income is expected to range from $9.2 million to $10.3 million, or $0.45 to $0.51 per diluted share (based on approximately 20.5 million common and equivalent shares outstanding). For the comparable period in 1999, net sales were $60.2 million and net income of $7.6 million, or $0.44 per diluted share (based on 17.5 million common and equivalent shares outstanding). The 2000 results represent an increase in
net sales of 50% to 58% and an increase in net income of 21% to 34%.
Results for the quarter are expected to reflect strong sales by the Company's newly acquired Flying Colors division of crafts and activities products, strong sales of its Road Champs BXS® and MXS® line of extreme sports toys, and continuing sales of its WWF line of toy products. The company is experiencing a greater than expected slowdown in sales of its wrestling action figures and accessories attributable in part to the general softness in the toy industry and to the significant close-outs taking place at retail of competitive wrestling toy products. In addition, the industry-wide chip shortage has resulted in shipping delays of one of the company's major Christmas wrestling items, ``Real Sound Arena''. Earnings attributable to the sales of wrestling video games by the Company's joint venture with THQ Inc. remain in line with the Company's projections and the Company is optimistic about the upcoming releases of new WWF wrestling games on the Nintendo 64 and Sony PlayStation and Game Boy Color platforms in the fourth quarter 2000 and for WWF video game releases in the year 2001 for new game platforms.
Jack Friedman, Chairman and CEO of the Company stated, ``I believe the third quarter will reflect the outstanding job that we have done diversifying our product line mix so as to become substantially less reliant on the WWF line of toy products with which we had been almost exclusively identified with in the past, even though it remains an important and solid component of our business. Through our acquisitions of Flying Colors® and most recently of Pentech®, we have been able to diversify and expand our product lines to new categories that should make solid contributions to our financial results in the future. Internally, we continue to develop new and exciting toy products such as our successful line of extreme sports toys that have met with a wide range of success. We remain committed to our strategy of growing our company to provide compelling products to our consumers while being less dependent on any one product item. In this regard, we have made tremendous strides while at the same time being able to maintain very solid financial results and growth.''
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