Currency fluctuations slow Lego growth

Changes in currency value have slowed Lego's sales growth according to its CEO.
Publish date:
Social count:

Lego said sales growth will slow next year as the Danish krone's advance clips gains in the US and Asia.

Revenue will rise four per cent to five per cent next year, compared with the 12 per cent growth anticipated for 2008, Chief Executive Officer Joergen Vig Knudstorp said.

The krone's appreciation against sterling the dollar and the yen has lopped three to four percentage points off revenue growth so far this year, he said.

"This year is unusual,'" Knudstorp said. "It's not a natural growth rate. A steady five per cent is a natural rate. If I can sustain that over a 10-year period, I would be very happy."

The firm raised its forecast for 2008 sales growth last month after first-half profit more than doubled, helped by US demand for Indiana Jones-themed sets of its plastic building bricks.

Lego generated 30 per cent of sales in North America, Australia, New Zealand and the UK in 2007, and about 27 per cent in Scandinavia, the Benelux countries, eastern Europe and Asia.

Sales generated in local currency lose in value when translated back into Lego's main currency, the Danish krone. Lego has forecast sales of 9 billion kroner ($1.8 billion) this year.

"We're quite optimistic about this year,'' he said. "We are aware that macroeconomics are not moving in the right direction, but we have the right product portfolio."

Knudstorp forecast growth of at least 50 percent over the next seven years in China and said the toymaker wants to scale up in Mexico, Latin America and India. The company aims to increase its US market share by one percentage point to four per cent over the next five to seven years, he said.

Source: Bloomberg


Featured Jobs

Vivid Job Logo 620 x 349

Digital Marketing Executive - Toys & Games

Vivid is Britain’s biggest toy company and the 20 largest in the world. With offices across the globe, they sell an amazing portfolio of toys and games to over 60 countries. Vivid is best known for its association with blockbuster brands and is very excited about future opportunities around the world.


UK Sales Agents

Liberty House Toys have been appointed as the exclusive UK distributor for the BiOBUDDi brand, and we are pleased to introduce this new unique, innovative and exciting range of 100% environmentally-friendly toy building blocks. We are seeking experienced sales agents with existing network in the toy retail market.

Gameplan Job Logo 620 x 349

Head of Product Development & Marketing

Our client is a privately owned French toy and games manufacturer which sells through distributors in forty countries. The company develops and sells innovative electronic interactive toys and games for the educational and gaming markets, and also takes suitable licenses. To progress its successful business development a Head of Product Development & Marketing is to to recruited.

HIT Entertainment Job Logo 620 x 349

Licensing Systems Administrator

The Contract System Coordinator is a newly created role to support the deal term entry process into Mattel’s new Contract Management System for its Licensing business. The role will support the Business Teams at the Deal & Amendment phase of the contracting process and act in conjunction with the System Administration team.