JAKKS’ Results Ahead of Estimates – Analyst Blog

JAKKS Pacific Inc. (JAKK) reported its adjusted second quarter earnings of 11 cents per share, beating the Zacks Consensus Estimate by 6 cents. The company had incurred a loss of 3 cents per share in the year-ago quarter.

 

While the company experienced a decline in net sales, the results were helped by cost cuts, restructuring activities and strong demand for its products.

 

GAAP net income was $3 million or 11 cents per share, compared with a net loss of $406.6 million or $14.96 per share in the year-ago quarter.

 

The company reported a 15.2% year-over-year decrease in revenue to $123.3 million. However, the reported revenue outperforms the Zacks Consensus Estimate of $110.0 million.

  

Selling, general and administrative expenses decreased 20% year over year to $31.0 million. This decrease is primarily due to the cost-cutting measures implemented by the company and lower overall sales.

  

JAKKS’ product line is strong in the second half of 2010, including new toys, electronics and Halloween costumes, with the large shipment expected in the third quarter of 2010. The company also remains confident about the progress in its product line for 2011. JAKKS is also experiencing stronger bookings for its products ahead of last year.

 

 

As of June 30, 2010 JAKKS had cash and cash equivalents and marketable securities of $249.0 million versus $255.0 million at the end of December 31, 2009. The company’s working capital and long-term debt for first half of 2010 was $358.1 million and $88.1 million compared with $352.2 million and $86.7 million, respectively at the end of 2009.

  

During the quarter, JAKKS used $20.3 million of cash on hand to redeem its 4.625% Convertible Senior Notes.

 

  

JAKKS reaffirmed its guidance of earnings in the range of $1.10 to $1.20 per share and net sales in the range of $660.0 to $670.0 million for fiscal 2010.