California-based toymaker Jakks Pacific reported net sales of US$613.1 million for fiscal 2017, a decline of 13% compared to US$706.6 million in 2016. The company’s net sales in Q4 2017 were US$136.6 million (down from US$167 million the year before).
Fiscal 2017 saw declines for Star Wars, Frozen and Tsum Tsum, but those losses were partially offset by strength in various DC Comics products, Moana, Squish-Dee-Lish and Tangled (pictured). The company reported that multiple factors contributed to the losses, including Toys “R” Us filing for bankruptcy protection and softness among a number of legacy products lines that were not offset by new launches.
Net loss for the fiscal year was US$83.1 million, while net loss for the fourth quarter in 2017 was US$30.4 million.
Adjusted EBITDA in 2017, meanwhile, was US$15.8 million (compared to US$41.7 million the year before). Adjusted EBITDA in Q4 specifically was negative US$6.8 million (compared to positive US$4 million in Q4 2016).
Moving forward, Jakks Pacific plans to expand its retail private label programs and exclusive product initiatives in 2018. There will also be a continued focus on skincare and cosmetics with C’est Moi, Jakks’ proprietary cosmetic brand for tweens. The company’s expectation for 2018 is to grow sales modestly and return to profitability (Jakks Pacific reported losses in Q3, Q2 and Q1 of 2017).
According to the toymaker, Hong Kong Meisheng Cultural Company Limited expressed interest in January to buy additional shares and bring its holdings to 51% of Jakks’ shares. A committee of independent members of Jakks Pacific’s board of directors has been formed to evaluate the expression of interest.