Exhibit 99.1
JAKKS Pacific Reports 2007 First Quarter Results
2007 Sales Increase 15.7% and EPS Increases 33% Over 2006
MALIBU, Calif.--(BUSINESS WIRE)--April 26, 2007--JAKKS Pacific,
Inc. (NASDAQ:JAKK), a leading multi-brand company that designs and
markets a broad range of toys, writing instruments and other consumer
products, today announced results for the first quarter ended March
31, 2007.
First quarter net sales increased 15.7% to $124.1 million compared
to $107.2 million in the same period last year. Net income for the
first quarter of 2007 was $3.2 million, resulting in diluted earnings
per share of $0.12, an increase of 33%. Net income in the first
quarter of 2006 was $2.3 million, or $0.09 per diluted share.
"We are pleased with our first quarter performance and believe we
are well positioned to achieve our record sales and earnings
expectations for 2007," said Jack Friedman, Chairman and Chief
Executive Officer, JAKKS Pacific.
"Consumer demand for our large feature role-play sets and timeless
dress-up items resulted in a meaningful contribution from this
category. We also experienced strong sales of our newly introduced
line of Pokemon(R) toys, as well as our WWE(R) action figures and
kid-driven Plug It In & Play TV Games(TM) titles, among other products
based on popular entertainment content."
Stephen Berman, President and Chief Operating Officer, stated,
"During the first quarter, we launched several new well-performing
products and line extensions, including our TV Game product based on
the hit NBC game show, Deal or No Deal(R). Sales of our pet products
continue to increase as more mass and specialty retailers expand shelf
space devoted to our pet product offerings.
"We continue to expand our core products through internal product
development initiatives and have many new products launching
throughout the year that we anticipate will provide continued growth
for JAKKS Pacific in 2007, including fashion dolls, dress-up and
role-play products for the two Disney 'tween' sensations Hannah
Montana(TM) and The Cheetah Girls(TM); a special edition 25th
Anniversary Care Bear(R); and new XPV Xtreme Performance Vehicle(R)
toys. These products, along with our Plug It In & Play EyeClops(TM)
bionic eye, are expected to ship at the end of the second quarter."
Mr. Friedman added, "We will continue to seek to grow our business
by actively pursuing additional character and product licenses, as
well as complementary acquisitions that offer valuable product lines,
trademarks or brands. Our financial position remains very strong and,
as of March 31, 2007, our working capital was approximately $284.1
million, including cash and equivalents of $192.0 million.
"We are reaffirming our previously issued 2007 guidance of at
least $800 million in net sales and net income of $75.8 million, or
$2.39 per diluted share."
JAKKS Pacific is hosting a teleconference at 10:30 a.m. ET (7:30
a.m. PT) on April 26th, via the Internet at www.jakkspacific.com,
www.CompanyBoardroom.com, or www.StreetEvents.com. These websites will
host an archive of the teleconference for 30 days. A telephonic
playback will be available from 11:45 a.m. ET on April 26th through
12:00 a.m. ET on May 24th. The playback can be accessed by calling
800-642-1687, or 706-645-9291 for international callers, pass code
"5235346."
About JAKKS Pacific, Inc.
JAKKS Pacific, Inc. (NASDAQ:JAKK) is a multi-brand company that
designs and markets a broad range of toys and consumer products. The
product categories include: Action Figures, Art Activity Kits,
Stationery, Writing Instruments, Performance Kites, Water Toys, Sports
Activity Toys, Vehicles, Infant/Pre-School, Plush, Construction Toys,
Electronics, Dolls, Dress-Up, Role-Play, and Pet Toys and Accessories.
The products are sold under various brand names including JAKKS
Pacific(R), Play Along(R), Flying Colors(R), Creative Designs
International(TM), Road Champs(R), Child Guidance(R), Pentech(R),
Trendmasters(R), Toymax(R), Funnoodle(R), Go Fly A Kite(R), Color
Workshop(R), JPI(TM) and Plug It In & Play TV Games(TM). JAKKS and THQ
Inc. participate in a joint venture that has worldwide rights to
publish and market World Wrestling Entertainment video games. For
further information, visit www.jakkspacific.com.
This press release may contain forward-looking statements (within
the meaning of the Private Securities Litigation Reform Act of 1995)
that are based on current expectations, estimates and projections
about JAKKS Pacific's business based partly on assumptions made by its
management. These statements are not guarantees of future performance
and involve risks, uncertainties and assumptions that are difficult to
predict. Therefore, actual outcomes and results may differ materially
from what is expressed or forecasted in such statements due to
numerous factors, including, but not limited to, those described
above, changes in demand for JAKKS' products, product mix, the timing
of customer orders and deliveries, the impact of competitive products
and pricing, and difficulties with integrating acquired businesses.
The forward-looking statements contained herein speak only as of the
date on which they are made, and JAKKS undertakes no obligation to
update any of them to reflect events or circumstances after the date
of this release.
(C) JAKKS Pacific, Inc. All Right Reserved.
JAKKS Pacific, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
March 31, December 31,
2007 2006
------------ ------------
(In thousands)
ASSETS
Current assets:
Cash and cash equivalents $ 192,033 $ 184,489
Marketable securities 212 210
Accounts receivable, net 75,111 153,116
Inventory, net 69,001 76,788
Deferred income taxes 10,946 10,592
Prepaid expenses and other current assets 21,726 26,543
------------ ------------
Total current assets 369,029 451,738
------------ ------------
Property and equipment 52,003 49,781
Less accumulated depreciation and
amortization 35,745 32,898
------------ ------------
Property and equipment, net 16,258 16,883
------------ ------------
Deferred income taxes 1,471 -
Goodwill, net 338,007 337,999
Trademarks & other assets, net 56,982 60,401
Investment in video game joint venture 16,393 14,873
------------ ------------
Total assets $ 798,140 $ 881,894
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 59,126 $ 120,238
Reserve for sales returns and allowances 18,097 32,589
Income taxes payable 7,713 18,548
------------ ------------
Total current liabilities 84,936 171,375
------------ ------------
Long term debt 98,000 98,000
Other liabilities 5,313 854
Income taxes payable 8,093 -
Deferred income taxes 2,379 2,377
------------ ------------
113,785 101,231
------------ ------------
Total liabilities 198,721 272,606
Stockholders' equity:
Common stock, $.001 par value 28 28
Additional paid-in capital 303,167 300,255
Retained earnings 299,667 312,432
Accumulated other comprehensive income
(loss) (3,443) (3,427)
------------ ------------
599,419 609,288
------------ ------------
Total liabilities and stockholders'
equity $ 798,140 $ 881,894
============ ============
JAKKS Pacific, Inc. and Subsidiaries
First Quarter Earnings Announcement, 2007
Condensed Statements of Income (Unaudited)
Three Months Ended March 31,
2007 2006
-------------- --------------
(In thousands, expect per
share data)
Net sales $ 124,062 $ 107,244
Less cost of sales
Cost of goods 64,370 52,207
Royalty expense 12,327 9,615
Amortization of tools and molds 1,857 1,259
-------------- --------------
Cost of sales 78,554 63,081
-------------- --------------
Gross profit 45,508 44,163
Direct selling expenses 11,827 14,331
Selling, general and administrative
expenses 26,403 23,064
Depreciation and amortization 3,954 4,524
-------------- --------------
Income from operations 3,324 2,244
Other income (expense):
Profit (loss) from video game joint
venture 1,495 757
Interest income 1,514 1,415
Interest expense (1,571) (1,133)
Other expense - -
-------------- --------------
Income before provision for income taxes 4,762 3,283
Provision for income taxes 1,524 952
-------------- --------------
Net income $ 3,238 $ 2,331
============== ==============
Earnings per share - diluted $ 0.12 $ 0.09
Shares used in earnings per share -
diluted 27,986 32,617
CONTACT: JAKKS Pacific, Inc.
Genna Rosenberg, 310-455-6235
or
Integrated Corporate Relations
John Mills, 310-954-1100