Frozen 2 helped Jakks Pacific to its strongest quarter in almost five years, as sales climbed almost a fifth year on year to $280 million.
Alongside Elsa dolls, sales of Nintendo licensed products and the company’s costume brand Disguise “more than offset the declines of some older products”, says Jakks Chairman and CEO Stephen Berman.
The chief executive promised a strong end to the year after a flaky Q2 in which sales slumped 10 per cent to $95.2 million, and is delivering on the promise.
“Our net sales grew 18 per cent in the quarter, the strongest quarterly growth in year-over-year sales we have seen in nearly five years, led by online sales of our products, which were up 32 per cent compared to last year,” says. “More importantly, we were able to improve gross margins and tightly managed expenses.”
The result was a 64 per cent YOY increase in adjusted EBITDA.
Gross margin also moved in the right direction at 28.9 per cent, up from 27.2 per cent in the third quarter of last year.
“We expect to close out the year on a strong note, and carry momentum into 2020,” Berman adds. “We remain committed to containing costs and managing our balance sheet prudently. We expect good performances over the holiday season from Frozen 2, Nintendo, Disney Princess and X-Power Dozer.”
Alongside the quarterly report, Jakks CFO Brent T. Novak also announced his departure from the company to pursue other opportunities.
Berman praised the him as “a valued member of the Jakks team”, wishing him “well in his future endeavours”.
The strong results follow rumours early last month that Just Play was nearing a deal to acquire Jakks Pacific for 80-90 cents per share. Jazwares was previously the front runner until it’s parent company Alleghany Corp. snapped up Wicked Cool Toys, the US toy firm behind the most recent crop of best-selling Pokémon toys.