LeapFrog 'on plan' with results

Sales of $56.0m, but a net loss of $28.0m for the firm's second quarter.
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LeapFrog president and CEO Jeffrey G Katz has said the firm "came in on plan" after revealing its first half year and second quarter results yesterday.

The company measured net sales of $56 million, compared with $68.1 million for the same period in 2006. The decrease of 17.8 per cent was put down to lower sales of products being phased out.

Despite lower sales, the firm's gross profit was up by $3.2 million to $20.3 million as a result of higher gross margins. Operational expenses were down slightly year-on-year but, as expected, general and administrative expenses rose by nearly seven per cent, down to the new marketing office in Bejing, China.

Katz said: "We continue to focus on better execution at retail while placing a big emphasis on our new product launches this fall and in 2008. We're on track with our plans to relaunch our once substantial reading business next year, grow our successful educational gaming business and strengthen our infant business as well. We have also begun implementing a series of initiatives to ensure that our growth over the next few years translates into solid earnings.

"These initiatives, which are geared toward driving operational efficiencies and reducing costs, will begin to take effect immediately and will be realised over the next 12 months."

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