MGA ENTERTAINMENT: Global sales boost firm

European and Latin American markets drive MGA?s business.
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MGA Entertainment has seen international sales contribute 50 per cent to its business in the past three to four years, as markets like Europe and Latin America grow, according to its boss.

Issac Larian, CEO, also said online sales to consumers would make up eight to ten per cent of total revenue in two to three years, compared to the current two or three per cent, as increasing fuel prices lead shoppers to buy online rather than in store.

Larian expects the toy industry's Christmas sales to be flat to down two per cent to three per cent, or down eight per cent to ten per cent "if you put inflation into that," which he said would be in line with MGA's outlook for itself.

"We are trying to be very, very conservative. We do not want to be stuck with inventory," he said.

The firm is increasing its prices on a case by case basis, by about five per cent to retailers, which they would pass down to consumers, he said. But to compensate, the firm is expanding distribution into specialist stores.

"We, as well as I believe everybody else in the toy industry, is planning our business down because of the recession and what's happening there.

"My general feeling is that people would buy lower-priced toys this year compared to higher prices. They will not indulge."

Meanwhile, Larian remains 100 per cent confident the firm will retain the rights to the $1 billion Bratz franchise, with which it is currently embroiled in a legal battle with Mattel. He added it would explore IPO plans in the next couple of years and would even consider selling the firm.

"I will never say that is not an option. One thing which is not in the options is - I don't think I will ever sell my company to Mattel," he said.



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