JAKK earnings out!! Very nice...
Tuesday April 28, 4:02 pm Eastern Time
Company Press Release
JAKKS Pacific Inc. Reports First- Quarter 1998 Results
MALIBU, Calif.--(BUSINESS WIRE)--April 28, 1998--JAKKS Pacific Inc. (Nasdaq/NM:JAKK - news) Tuesday
announced strong net sales, net income and earnings per share for the first quarter ended March 31, 1998.
For the quarter, net sales increased to $11.0 million, up 111 percent from $5.2 million for the comparable period in 1997. Net
income for the 1998 quarter rose to $462,000, or 8 cents per diluted share, vs. $203,000, or 5 cents per diluted share
(including a 1997 tax benefit of $80,000, or 2 cents per diluted share), in 1997.
The weighted average number of common and dilutive common- equivalent shares outstanding for the first quarters of 1998
and 1997 was 7,160,000 and 4,332,000, respectively. In addition, earnings before interest, taxes, depreciation and
amortization (EBITDA) climbed to $1.4 million in 1998, 227 percent more than the $434,000 achieved in the first quarter last
year.
Commenting on the results, Jack Friedman, chief executive officer of JAKKS Pacific, said: ''JAKKS enjoyed another great
quarter, in keeping with the momentum we built in 1997.
''Sales from Road Champs(R) and our renowned World Wrestling Federation (WWF) line of action figures continue to
accelerate, while revenue has begun to kick in from our recently acquired Remco(R) and Child Guidance(R) lines of vehicles
and preschool toys. Clearly, our ability to leverage our infrastructure and rapidly absorb new lines of business into our
operations has helped to fuel our profitability.
''Thanks to the success of our current businesses, we believe that our prospects for the future will continue to improve as the
year progresses. We remain committed to our strategy to building a portfolio of toy brands with evergreen appeal and
expanding our product categories through internal growth and acquisitions.''
JAKKS recently announced that it had extended the license agreement for its WWF action figures and other toy products
through 2002. As part of the license agreement, the company is expanding this line to include numerous other toy-related
products.
Based on this agreement, JAKKS plans to ship more than 100 new WWF products in 1998. Further, in its Remco and Child
Guidance lines, JAKKS launched the marketing and sale of 150 toys and related products. Including Road Champs vehicles,
the company intends to introduce approximately 200 new toys under these brand names by 1999.
JAKKS Pacific and its affiliates develop, manufacture and market toys and related products for children, including action
figures featuring characters from the World Wrestling Federation, die-cast collectible and toy vehicles under the Road Champs
and Remco brand names, Child Guidance preschool toys and a line of fashion dolls and accessories.
''Safe-harbor'' statement under the Private Securities Litigation Reform Act of 1995: This news release contains
forward-looking statements. Such statements reflect the current views of the company with respect to future events and are
subject to certain risks, uncertainties and assumptions. Although the company believes that the expectations reflected in such
forward-looking statements are reasonable, should one or more of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual future results or events may vary materially from those described herein.
JAKKS PACIFIC INC. AND SUBSIDIARIES
Condensed Statements of Operations
(Unaudited)
Three months ended
March 31,
1998 1997
Net sales $11,029,771 $5,235,196
Less costs of sales:
Cost of goods 5,514,498 2,640,631
Royalty expense 861,844 388,443
Amortization of tools/molds 303,561 147,822
Cost of sales 6,679,903 3,176,896
Gross profit 4,349,868 2,058,300
Direct selling expenses 915,083 221,285
Selling, general and administrative expenses 2,318,859 1,550,477
Amortization of intangible assets 348,067 113,544
Income from operations 767,859 172,994
Other income (expense):
Interest, net (157,739) (49,204)
Pretax income 610,120 123,790
Provision for (benefit from) income taxes 148,259 (79,627)
Net income $ 461,861 $ 203,417
Earnings per share -- diluted $ 0.08 $ 0.05
Weighted average common and dilutive
common-equivalent shares outstanding 7,160,000 4,332,000
JAKKS PACIFIC INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
March 31, Dec. 31,
1998 1997
(Unaudited) (Audited)
Assets:
Current assets:
Cash and cash equivalents $ 1,078,872 $ 2,535,925
Accounts receivable, net 6,918,467 8,735,528
Inventory, net 1,612,862 1,948,250
Deferred product-development costs, net 967,982 807,603
Advance royalty payments, net 266,217 252,603
Prepaid expenses and other current assets 619,979 647,427
Total current assets 11,464,379 14,927,336
Property and equipment 4,576,638 3,955,856
Less accumulated depreciation and amortization 1,424,760 1,099,207
Property and equipment, net 3,151,878 2,856,649
Deferred offering costs, net 588,171 626,713
Goodwill, net 10,602,340 10,695,488
Trademark and patents, net 14,019,627 14,180,118
Other assets 459,137 318,511
Total assets $40,285,532 $43,604,815
Liabilities and stockholders' equity:
Current liabilities:
Accounts payable and accrued expenses $ 6,206,557 $ 8,594,523
Current portion of debt 1,065,198 2,361,076
Income taxes payable 522,308 603,614
Total current liabilities 7,794,063 11,559,213
Convertible debentures 6,000,000 6,000,000
Deferred income taxes 86,896 86,896
6,086,896 6,086,896
Total liabilities 13,880,959 17,646,109
Stockholders' equity:
Preferred stock, $.001 par value, 5,000
shares authorized; nil and 3,525
issued and outstanding, respectively -- 4
Common stock, $.001 par value, 25,000,000
shares authorized; 5,882,092 and 4,942,094
issued and outstanding, respectively 5,882 4,942
Additional paid-in capital 21,662,826 21,693,061
Retained earnings 4,864,497 4,402,636
26,533,205 26,100,643
Less unearned compensation from grant
of options 128,632 141,937
Net stockholders' equity 26,404,573 25,958,706
Total liabilities and stockholders' equity $40,285,532 $43,604,815
Contact:
JAKKS Pacific Inc., Malibu
Joel Bennett, 310/456-7799
or
Silverman Heller Associates, Los Angeles
Eugene Heller or Lori Parks, 310/208-2550 |
