Danish toy maker Lego today published one of its strongest earnings reports ever for 2008 despite the financial crisis, just a few years after fierce competition from electronic games nearly brought it down.
The maker of the iconic interlocking and studded plastic bricks posted a net profit of 1.35 billion kroner (€181m), up 31.5% from 1.02 billion in 2007. Pre-tax profit jumped by 31% to 1.85 billion kroner compared to 1.41 billion a year earlier, while operating profit before exceptional items, charges and restructuring climbed by 36.2% to 2 billion kroner.
'Our results for 2008 have been extraordinarily good,' Joergen Vig Knudstorp, Lego's CEO, said. Sales were up by 18.7% to 9.52 billion kroner, compared to 8.02 billion a year earlier.
Lego announced double-digit growth in almost all of its markets, especially in English-speaking areas, which saw 'extraordinarily high sales increases,' including a 38% increase in the US.
The family-owned company reported millions of euros in losses in 1998, 2000, 2003 and 2004 as competition stiffened from the skyrocketing popularity of high-tech computer games.
Since then it has undergone major restructuring and refocused on its core business of selling its colourful plastic blocks.
The company said it expected the good times to continue this year despite the ongoing global slowdown.
'Despite gloomy economic prospects, we feel well prepared for growth in 2009 as well, and our optimism is supported by the results seen in the first months of the year,' Knudstorp added.
Lego is Europe's biggest traditional toy maker and sixth biggest worldwide.
