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JAKKS Pacific Reports Third Quarter 2020 Financial Results
Substantial Progress on Improving Profitability SANTA MONICA, Calif.--(BUSINESS WIRE)-- JAKKS Pacific, Inc. (NASDAQ: JAKK) today reported financial results
About this update from Jakks Pacific, Inc.
[{"type":"text","content":"\nSubstantial Progress on Improving Profitability\n\n SANTA MONICA, Calif.--(BUSINESS WIRE)--\nJAKKS Pacific, Inc. (NASDAQ: JAKK) today reported financial results for the third quarter ended September 30, 2020.\n\nHighlights\n\n\nThird quarter 2020 net sales were $242.3 million compared to $280.1 million last year \n\n\nExcluding declines in Frozen and Disguise Halloween costumes, Q3 net sales were up 13% year-over-year\n\n\nRetail POS at top three accounts up 28% year-to-date\n\n\n\n\nGross margin of 30.8%, up from 28.9%, an improvement of 190 basis points year-over-year driven by disciplined cost control and improved inventory \n\n\nJAKKS’ inventories down 16% year-over-year, both at top three retailers and on JAKKS’ balance sheet\n\n\n\n\nStrong liquidity of $112 million with unrestricted cash of $75 million and revolver availability of $37 million\n\n\nThird quarter 2020 net income attributable to common stockholders of $32.1 million\n\n\nYear-to-date Adjusted EBITDA of $24.3 million up 56% vs. $15.6 million in 2019 \n\n\nSubsequent to the quarter-end, the Company reached an agreement with term loan holders that provided covenant relief through March 2022 and a related $15 million early pay-down that will save $1.6 million in annual interest expense\n\n\nManagement Commentary\n\n“Our third quarter results exceeded our expectations for sales, gross margin, operating income and adjusted EBITDA,” said Stephen Berman, JAKKS Pacific’s Chairman and CEO. “We faced significant challenges in the quarter, including difficult comparisons against the successful launch of Disney Frozen 2 last year and reduced retailer commitments to Halloween products. Excluding declines in Disney Frozen® merchandise and Disguise Halloween costumes, our net sales rose thirteen percent compared to the third quarter of last year. Our disciplined cost controls and improved inventory management resulted in higher gross margins, lower SG&A expenses and higher operating income. Retail sales of our products continued to accelerate during the quarter. Our top three US customers in aggregate reported an increase in year-to-date sell-through of 28% through the first nine months, compared to an increase of 14% through the first half.\n\n“We expect the balance of this year to show continued progress on profitability despite difficult revenue comparisons, and to end ...