Q3 boost for Mega Brands

Mega Brands has seen its sales boosted by some 30 per cent for the third quarter ending September 30th 2006.
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Consolidated net sales for the period increased by 30.9 per cent to $201.8 million compared to $154.2 million in the third quarter of 2005.

Net sales in North America were up by 44 per cent to $141.9 million - compared with $98.5 million in the corresponding period last year. The increase was attributed to higher sales in the toys and stationery and activities product lines, as well as the inclusion of Mega Brands America Group's sales for the full quarter compared to approx two months last year.

International net sales increased, too, but by just 7.5 per cent, to $59.9 million. These accounted for 29.7 per cent of consolidated sales, compared to 36.1 per cent in the same period last year.

In addition, following the end of the third quarter, Mega Brands settled four lawsuits and ten claims related to injuries resulting from the ingestion of magnets. Terms of the settlement, which include no admission of liability, are confidential, however the aggregate amount paid to settle the lawsuits and claims was $13.5 million.

The company expects to recover substantially the full amount from its insurers and through other recourses.

"We are pleased to report strong sales and earnings for the third quarter and a great response to our products are retail in all markets," said Marc Bertrand, president and CEO of Mega Brands.

Looking ahead to 2007, and the company is focusing on product innovation as a key driver. "We have an exceptional growth offering in the pipeline for next year featuring outstanding innovation in existing and new categories, exciting new global licensing deals and mass media exposure generated by two major theatrical releases in May," added Bertrand.

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