Spin Master has lauded a ‘strong financial and operating performance’ in its Q1 2021 results, with product sales increases across key markets, including Europe, North America, and Rest of the World.
Sales grew by 21.2 per cent in Europe and 18 per cent in North America, while the Rest of World segment witnessed an impressive 44.6 per cent sales increase. Spin Master has cited higher sales in its preschool and girls, and outdoor categories as the key driver behind the growth.
Total Q1 2021 revenue for the firm hit $316.6 million.
“Our performance this quarter clearly demonstrates our commitment to creating exceptional play experiences and engaging children’s entertainment through our three creative centres comprising toys, entertainment and digital games,” said Ronnen Harary, Spin Master’s co-founder.
“It is very gratifying to see both our strong financial and operating performance this quarter compared to the same period last year, especially from the continued growth in digital games. We recognize the incredible dedication of our teams across the globe.
“Together, they have rallied to drive the strong results we achieved this quarter. As we manage through the complexities of the pandemic, I am continually amazed and impressed by the effort and dedication of our employees.”
Max Rangel, Spin Master’s newly appointed global president and CEO, added: “At the heart of Spin Master’s growth story is a remarkable purpose – to create magical play experiences for children and their families around the world. Our commitment to that purpose is unwavering. How we bring this vision to market across our three creative centres will continue to evolve and adapt to the changing content landscape, consumer preferences and emerging trends in children’s entertainment.
“With this solid foundation, supported by relentless innovation and operational excellence, we see tremendous potential for Spin Master and are focused on driving profitable growth and creating significant value for our shareholders.”
Spin Master’s Entertainment and Licensing saw revenue increase 79.3 per cent to hit $26.9 million compared to the year prior, while its digital games revenue jumped a massive 394.2 per cent to $34.1 million, driven primarily by the Toca Life World platform and growth in the Sago Mini subscription user base.
Gross profit for the firm was $157.4 million, representing 49.7 per cent of total revenue, compared to $90.8 million the year prior. The improvement in gross margin was driven by higher digital games net revenue and entertainment and licensing net revenue.
“We delivered very strong margins and profitability in the first quarter and are particularly pleased with the broad nature of our performance improvements compared to Q1 2020,” said Mark Segal, Spin Master’s chief financial officer.
“Revenue grew as a result of higher gross product sales and growth in digital games led by Toca Life World. Our operational improvements continued to allow us to execute more efficiently and effectively this quarter. Our solid financial position with cash on hand of over $260 million, gives us increasing opportunities to leverage our diverse and global platform for organic growth and acquisitions. We expect many of the trends that drove this performance in the first quarter to continue and we are raising our outlook for 2021.”
Gross product sales across Spin Master’s Activities, Games & Puzzles and Plush increased by $7.4 million or 9.2 per cent to $87.5 million. The increase was driven primarily by sales of Rubik’s and Inkfluencer as well as increases in the Games & Puzzles portfolio.
Meanwhile, gross product sales in Preschool & Girls increased by $24.1 million or 33 per cent to $97.2 million. The increase was driven by sales of PAW Patrol and Present Pets, offset in part by declines in Twisty Petz, Candylocks, Owleez, Hatchimals products and Universe.
Gross product sales in Boys increased by $7.3 million or 12 per cent to $68 million. The increase was primarily driven by sales of Monster Jam, Bakugan, Tech Deck and Supercross, partially offset by declines in DC licensed products and DreamWorks Dragons.
Gross product sales in Outdoor increased by $13.6 million or 47.9 per cent to US$42.0 million.