Jakks Pacific, Inc. · NASDAQ:JAKK
Jakks Pacific — Q3 2024 Earnings Presentation
44 slides from Jakks Pacific's earnings presentation, Oct 30, 2024
Slide 1: Third Quarter 2024 Earnings Presentation
Third Quarter 2024 Earnings Presentation October 30, 2024 5:00 PM Eastern / 2:00 PM Pacific Registration link 3Q24 Registration Link Webcast link Webcast 1
Slide 2: Executive Team on the Call
EXECUTIVE TEAM ON THE CALL STEPHEN BERMAN Chairman & Chief Executive Officer JOHN KIMBLE Executive Vice President & Chief Financial Officer 2
Slide 3: Safe Harbor Statement
SAFE HARBOR STATEMENT The Company would like to point out that any comments made about JAKKS Pacific's future performance, events or circumstances, including the estimates of sales and/or Adjusted EBITDA in 2024, as well as any other forward-looking statements concerning 2024 and beyond are subject
Slide 4: Third quarter 2024 results highlights
• Net sales were $321.6 million, a year-over-year increase of 4% • Gross margin of 33.8%, down 70 basis points vs. Q3 2023 • Gross profit of $108.8 million, up $1.8 million compared to $107.0 million in Q3 2023 • Operating income of $68.1 million, compared to an operating income of $62.4 million in
Slide 5: 2024 Third Quarter Net Sales
2024 Third Quarter Net Sales $ Millions $350 $323.0 $321.6 $309.7 $300 $250 $242.3 $237.0 $200 $150 $100 $50 $0 2020 2021 2022 2023 2024 YoY % Change: (2%) 36% (4)% 4% 5
Slide 6: 2024 Third Quarter Toys/Consumer Products Net Sales
2024 Third Quarter Toys/Consumer Products Net Sales $ Millions $300 $269.6 $264.3 $246.0 $250 $200 $187.3 $173.0 $150 $100 $50 $0 2020 2021 2022 2023 2024 YoY % Change: (8)% 56% (9)% 7% 6
Slide 7: 2024 Third Quarter Toys/Consumer Products Net Sales (NA and International)
2024 Third Quarter Toys/Consumer Products Net Sales $ Millions NA TOY/CP INTL TOY/CP $250 $80 $219.1 $210.5 $197.8 $200 $60 $53.8 $158.0 $50.5 $48.2 $150 $145.6 $40 $100 $29.3 $27.3 $20 $50 $0 $0 2020 2021 2022 2023 2024 2020 2021 2022 2023 2024 (8)% 50% (10)% 6% (7)% 85% (4)% 12% YoY % Change YoY %
Slide 8: 2024 Third Quarter Costumes Net Sales
2024 Third Quarter Costumes Net Sales $ Millions $80 $64.0 $63.7 $60 $55.0 $57.3 $53.4 $40 $20 $0 2020 2021 2022 2023 2024 YoY % Change: 16% (17)% 19% (10)% 8
Slide 9: 2024 Third Quarter Gross Margin %
2024 Third Quarter Gross Margin % 40.0% 35.0% 34.5% 33.8% 31.6% 30.8% 30.0% 28.5% 25.0% 20.0% 2020 2021 2022 2023 2024 YoY % Change: 80 bps (310) bps 600 bps (70 bps) 9
Slide 10: 2024 Third Quarter Adj. EBITDA and Adj. Net Income
2024 Third Quarter Adj. EBITDA and Adj. Net Income $ Millions Q3 ADJ EBITDA Q3 ADJ NET INCOME $80 $74.4 $80 $67.1 $59.4 $60 $60 $54.0 $50.1 $42.7 $41.7 $39.0 $40 $40 $34.2 $32.6 $20 $20 $0 $0 2020 2021 2022 2023 2024 2020 2021 2022 2023 2024 17.6% 17.6% 18.4% 21.7% 23.1% 13.5% 14.4% 12.1% 16.2% 16.8
Slide 11: 2024 YTD 9 Month Net Sales
2024 YTD 9 Month Net Sales $ Millions $700 $664.3 $600 $584.2 $560.3 $500 $433.2 $400 $387.6 $300 $200 $100 $0 2020 2021 2022 2023 2024 YoY % Change: 12% 53% (12)% (4)% 11
Slide 12: 2024 YTD 9 Month Toys/Consumer Products Net Sales
2024 YTD 9 Month Toys/Consumer Products Net Sales $ Millions $600 $529.6 $500 $461.8 $451.8 $400 $334.4 $306.1 $300 $200 $100 $0 2020 2021 2022 2023 2024 YoY % Change: 9% 58% (13)% (2)% 12
Slide 13: 2024 YTD 9 Month Toys/Consumer Products Net Sales (NA and International)
2024 YTD 9 Month Toys/Consumer Products Net Sales $ Millions NA TOY/CP INTL TOY/CP $500 $100 $440.9 $88.7 $90.2 $82.9 $400 $371.6 $368.8 $80 $300 $280.6 $60 $53.8 $256.4 $49.8 $200 $40 $100 $20 $0 $0 2020 2021 2022 2023 2024 2020 2021 2022 2023 2024 9% 57% (16)% (1)% 8% 65% 2% (8)% YoY % Change YoY
Slide 14: 2024 YTD 9 Month Costumes Net Sales
2024 YTD 9 Month Costumes Net Sales $ Millions $150 $134.7 $125 $122.3 $108.5 $98.8 $100 $81.5 $75 $50 $25 $0 2020 2021 2022 2023 2024 YoY % Change: 21% 36% (9)% (11)% 14
Slide 15: 2024 YTD 9 Month Gross Margin %
2024 YTD 9 Month Gross Margin % 40.0% 35.0% 32.5% 31.7% 30.7% 30.0% 27.8% 27.5% 25.0% 20.0% 2020 2021 2022 2023 2024 YoY % Change: 290 bps (320) bps 500 bps (80) bps 15
Slide 16: 2024 YTD 9 Month Adj. EBITDA and Adj. Net Income
2024 YTD 9 Month Adj. EBITDA and Adj. Net Income $ Millions 9MO ADJ EBITDA 9MO ADJ NET INCOME $100 $80 $88.5 $86.6 $57.5 $59.4 $80 $60 $69.4 $50.0 $60 $40 $44.2 $22.3 $40 $20 $24.3 $20 $0 ($2.6) $0 ($20) 2020 2021 2022 2023 2024 2020 2021 2022 2023 2024 6.3% 10.2% 13.3% 14.8% 12.4% (0.7)% 5.1% 8.7%
Slide 17: Third Quarter Inventory - 2023 vs 2024 (Worldwide)
Third Quarter Inventory - 2023 vs 2024 (Worldwide) $ Millions $75 $68.8M $63.5M $12.2 $13.9 $50 $56.6 $25 $49.6 $0 2023 2024 In-Transit to Warehouse Inventory less In-Transit 17
Slide 18: Core, evergreen business has steadily increased over the past 4 years
Core, evergreen business has steadily increased over the past 4 years... $323 $322 Net Sales $310 ($ Million) 67 58 98 $242 $237 $220 23 47 52 $188 $167 179 36 175 $149 35 126 158 11 $128 $132 116 $127 $121 $112 88 $107 22 23 38 30 8 $90 $84 29 77 89 122 $79 13 $67 16 11 60 77 18 63 70 86 32 55 64 5
Slide 19: Top Entertainment Properties
Top Entertainment Properties 2020 2021 2022 2023 2024 The Super Mario Disney Frozen 2 Disney Frozen 2 Disney Encanto Bros. Movie The Simpsons (Fall 2019) (Fall 2019) (Fall 2021) (Spring 2023) Disney The Little Disney Raya and Sonic the Mermaid Disney Moana 2 the Last Dragon Hedgehog 2 (Live Action)
Slide 20: Trailing-Twelve-Month (TTM) Adjusted EBITDA (non-GAAP)
Trailing-Twelve-Month (TTM) Adjusted EBITDA (non-GAAP) $ Millions TTM ADJ EBITDA TTM ADJ EBITDA % 10.6% $120 12.0% 9.6% 8.5% $100 $76 $76 10.0% 7.9% $80 8.0% $49 $58 5.5% $60 6.0% $28 $40 4.0% $20 2.0% $0 0.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
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Slide 38: Condensed Consolidated Statements of Operations (Unaudited)
JAKKS Pacific, Inc. and Subsidiaries Condensed Consolidated Statements of Operations (Unaudited) Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 Δ (%) 2024 2023 Δ (%) (In thousands, except per share data) (In thousands, except per share data) Net sales $ 321,606 $ 309,744
Slide 39: Condensed Consolidated Balance Sheets (Unaudited) - Assets
JAKKS Pacific, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (Unaudited) September 30, December 31, 2024 2023 2023 (In thousands) Assets Current assets: Cash and cash equivalents $ 22,070 $ 96,252 $ 72,350 Restricted cash 214 195 204 Accounts receivable, net 290,424 206,751 123,797 Inv
Slide 40: Condensed Consolidated Balance Sheets (Unaudited) - Liabilities and Equity
JAKKS Pacific, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (Unaudited) September 30, December 31, 2024 2023 2023 (In thousands) Liabilities, Preferred Stock and Stockholders' Equity Current liabilities: Accounts payable $ 98,928 $ 94,409 $ 42,177 Accounts payable - Meisheng (related
Slide 41: Supplemental Balance Sheet and Cash Flow Data (Unaudited)
JAKKS Pacific, Inc. and Subsidiaries Supplemental Balance Sheet and Cash Flow Data (Unaudited) September 30, Key Balance Sheet Data: 2024 2023 Accounts receivable days sales outstanding (DSO) 83 61 Inventory turnover (DSI) 27 31 Nine Months Ended September 30, Condensed Cash Flow Data: 2024 2023 Cas
Slide 42: Reconciliation of Non-GAAP Financial Information: EBITDA and Adjusted EBITDA
JAKKS Pacific, Inc. and Subsidiaries Reconciliation of Non-GAAP Financial Information (Unaudited) Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 Δ ($) 2024 2023 Δ ($) (In thousands) (In thousands) EBITDA and Adjusted EBITDA Net income $ 52,272 $ 48,121 $ 4,151 $ 43,313 $
Slide 43: Reconciliation of Non-GAAP Financial Information: Adjusted Net Income
JAKKS Pacific, Inc. and Subsidiaries Reconciliation of Non-GAAP Financial Information (Unaudited) Three Months Ended September 30, Nine Months Ended September 30, Adjusted net income attributable to common stockholders Net income attributable to common stockholders $ 52,272 $ 47,754 $ 4,518 $ 44,363
Slide 44: Net Sales by Division and Geographic Region
JAKKS Pacific, Inc. and Subsidiaries Net Sales by Division and Geographic Region (In thousands) QTD Q3 (In thousands) YTD Q3 % Change % Change % Change % Change Divisions 2024 2023 2022 2024 v 2023 2023 v 2022 Divisions 2024 2023 2022 2024 v 2023 2023 v 2022 Toys/Consumer Products $ 264,306 $ 246,00