TORONTO — Spin Master Corp. says it continues to face challenges from inflation, higher interest rates and a slowdown in consumer spending, including on toys, that it predicts will remain through least the end of the year.
The Toronto-based company, whose toy and entertainment brands include Paw Patrol, Bakugan and Hatchimals, has reduced the average prices of its toys by nine per cent for 2024, the CEO said on the call.
The comments came as Spin Master reported a loss of US$54.8 million in the first quarter, compared with a loss of US$1.9 million a year earlier. Its revenues totalled US$316.2 million, up from US$271.4 million during the same quarter last year. Chief financial officer Mark Segal said in a release that toy gross product sales excluding the acquisition's impact were in line with a year earlier, during what's normally the lowest quarter for the toy industry.
The company was focused on Melissa & Doug's integration efforts during the first quarter, improving cost efficiencies from the acquisition and moving toward $6 million in net cost savings this year, it said in the release. The goal is to achieve $25-$30 million in savings and efficiency by the end of 2026.
The innovation pipeline this fall is going to three times the levels seen last year, Rangel added. The company is planning to launch Ms. Rachel, Sticker Wow and Fold Play Gym among other indoor and interactive offerings.
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