Lego earnings plunge 19% in harder toy market
T
oy large Lego has seen half-year earnings tumble by almost a fifth because the growth in demand seen through the pandemic light.
The Danish group reported a 19% fall in working income to six.4 billion Danish krona (£738 million) within the six months to June 30.
Lego noticed gross sales progress sluggish to 1% with revenues at 27.4 billion Danish Krona (£3.2 billion) because it got here up in opposition to “exceptional” buying and selling a yr earlier, with demand having soared throughout Covid-19 restrictions.
Revenues have been flat with foreign money actions stripped out.
It marks a pointy reversal of buying and selling seen all through 2022, when revenues grew by 17%.
But Lego stated it outperformed a declining toy market, with “significant” progress in market share and shopper gross sales up 3%.
We are happy with our efficiency, particularly because it has been a difficult six months for the toy business
Lego chief govt Niels Christiansen stated: “We are satisfied with our performance, especially as it has been a challenging six months for the toy industry.
“Demand for our products saw us outpace the industry and significantly grow market share.
“Our strong financial position allows us to invest for the long term, particularly in areas such as digital, sustainability and manufacturing.
“Overall, our performance is in line with expectations, after three consecutive years of extraordinary growth.”
Lego stated shopper gross sales in China have been affected by a slower-than-forecast return to pre-pandemic procuring habits, with restrictions solely lifted within the nation earlier this yr.
The firm stated it can proceed to develop its retailer footprint and on-line providing throughout China this yr.