56% rise in pretax profit for Lego

 

Danish toymaker Lego reported a 56 per cent increase in pretax profit for 2009, helped by strong sales of its Star Wars and Lego City product lines despite a stagnant global market.

Privately owned Lego, which is among the world's biggest toy manufacturers, rivalling such groups as Mattel and Hasbro, said it expected its good growth to continue this year.

"In 2009 the Lego Group increased its global market share to 4.8 per cent," said the company which is known for its colourful snap-together plastic building blocks. It did not give a market share figure for the previous year.

Pretax profit rose to 2.89 billion Danish crowns in 2009 from 1.85 billion crowns in 2008 on a 22.4 per cent increase in revenues to 11.66 billion crowns, the company said in a statement.

"Overall, the global toy market was stagnant in 2009," the firm said. "(But) in nearly all markets, the Lego Group achieved strong growth.

"In the global toy market, continued stagnation is expected in 2010," it said, adding: "Based on the company's position and the highly satisfactory developments in 2009, the Lego Group expects the sales growth to continue in 2010."

The strongest growth in sales in 2009 was in English-speaking markets, and Lego products saw strong growth in all of Europe and most of Asia, it said.

Lego got into the board games business in 2009, launching games in Britain and the Germany-speaking countries, and game sales exceeded expectations, the company said.

Its games will be released in North America and the rest of Europe this year.

"Based on the good results in 2009 and our sales during the first months of 2010, we also expect sizeable growth this year," Lego chief executive Jorgen Vig Knudstorp said in the statement.

Reuters