RC2 counts cost of recall

RC2’s recall of its Thomas railway set could end up costing it $8m.
Author:
Publish date:
Social count:
0
5_Pocoyo.jpg

The firm last month recalled over a million Thomas and Friends wooden railway toys because they were contaminated with lead paint. Estimates as to the ultimate cost of the recall suggest it could be as much as $8 million.

The toy maker said it is recovering "high numbers" of the recalled toys, and that replacement costs and related expenses, which it had previously suggested might be in the range of $1m to $2m, will now require an after-tax second-quarter charge of $4m.

In addition, RC2 said, the company currently anticipates after-tax costs of an additional $3m to $4m to cover professional service fees, air freight, returns and replacement processing, marketing and promotional costs related to the recall.

Those charges, the company noted, "include estimated defense costs relating to the class action lawsuits that have been filed against the company."

The company said it is "encouraged by the high recovery levels" of the recalled products.

Related

5_Pocoyo.jpg

RC2 streamlines business focus

RC2 Corporation has sold its collectible trading card and die-cast sports collectibles business in order to better concentrate on its infant and children's toy products.

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.

Liberty

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.