Spin Master Reports Q2 2024 Financial Results and Reiterates 2024 Full Year Outlook
Toronto, Canada – Spin Master Corp. announced its financial results for the three and six months ended June 30, 2024. The Company’s full Management’s Discussion and Analysis (“MD&A”) for the three and six months ended June 30, 2024.
“Our second quarter revenue was in line with our expectations, despite pressure on consumer spending, impacting both Toy Gross Product Sales and in-game purchases within Digital Games”, said Max Rangel, Spin Master’s Global President & CEO. “Melissa & Doug had a strong quarter, and the integration is progressing well with incremental revenue opportunities emerging, together with operating synergies. Looking ahead to the balance of 2024, our team is focused on delivering our signature breakthrough innovation in toys and launching new properties, including Ms. Rachel, delivering entertainment that resonates with audiences on a global scale, such as Unicorn Academy, and releasing new experiences in digital games, such as Rubik’s Match, designed to expand our player ecosystem. We believe in Spin Master’s long-term growth potential driven by our diversified portfolio of innovative toys, engaging entertainment and open-ended digital games. With these compelling capabilities, we believe we will deliver our longer-term strategic and financial goals.”
“Toy Gross Product Sales in the second quarter excluding Melissa and Doug, were down compared to last year as we were lapping PAW Patrol: The Mighty Movie shipments from Q2 2023, but were in line with our expectations” said Mark Segal, Spin Master’s EVP & Chief Financial Officer. “We continued to execute on our capital allocation strategy and by the end of Q2, we have now repurchased over 1.1 million shares under our NCIB. Looking to the balance of the year, we are pleased to maintain our outlook for 2024. Over the long term, we will continue to invest to drive growth, while also managing our cost-base and preserving financial flexibility to maximize shareholder value.”
Consolidated Financial Highlights for Q2 2024 as compared to the same period in 2023
- Revenue was $412.0 million, including Melissa & Doug Revenue of $43.3 million, a decrease of 2.1% from $420.7 million. Revenue, excluding Melissa & Doug1 was $368.7 million, a decrease of 12.4%.
- Revenue by operating segment reflected an increase of 7.4% in Entertainment and a decline of 1.6% in Toys and 14.3% in Digital Games.
- Toy Gross Product Sales1 were $384.7 million, including Melissa & Doug Toy Gross Product Sales1 of $51.7 million, a decline of $5.3 million or 1.4% from $390.0 million. Toys Gross Product Sales, excluding Melissa & Doug1 were $333.0 million, a decrease of $57.0 million or 14.6% from $390.0 million.
- Operating Loss was $23.0 million compared to Operating Income of $34.4 million.
- Operating Margin2 was (5.6)% compared to 8.2%.
- Adjusted Operating Income1 was $23.6 million compared to $62.6 million. The decline in Adjusted Operating Income1 was primarily driven by decreases of $34.2 million in Toys and $6.9 million in Digital Games partially offset by an increase of $3.7 million in Entertainment.
- Adjusted Operating Margin1 was 5.7% compared to 14.9%.
- Net Loss was $24.5 million or $(0.24) per share compared to Net Income of $28.0 million or $0.27 per share.
- Adjusted Net Income1 was $9.6 million or $0.09 per share compared to Adjusted Net income1 of $48.8 million or $0.47 per share.
- Adjusted EBITDA1 was $53.6 million compared to $88.4 million, a decrease of $34.8 million. Adjusted EBITDA Margin1 was 13.0% compared to 21.0%.
- Adjusted EBITDA, excluding Melissa & Doug1 was $60.6 million compared to $88.4 million, a decrease of $27.8 million. Adjusted EBITDA Margin, excluding Melissa & Doug1 was 16.4% compared to 21.0%.
- Cash provided by operating activities was $25.4 million compared to $19.1 million.
- Free Cash Flow1 was $(3.6) million compared to $(5.9) million.
- The Company recognized $1.2 million in Net Cost Synergies3 and continues to expect to achieve approximately $6 million in Net Cost Synergies3 in 2024.
- The Company repurchased and cancelled 778,281 subordinate voting shares for $17.5 million (C$23.7 million) through the Company’s Normal Course Issuer Bid (the “NCIB”) program. Subsequent to June 30, 2024, the Company repurchased and cancelled 318,200 subordinate voting shares for $6.9 million (C$9.5 million).
- The Company repaid $15.0 million of loans and borrowings.
- Subsequent to June 30, 2024, the Company declared a quarterly dividend of C$0.12 per outstanding subordinate voting share and multiple voting share, payable on October 11, 2024.
Consolidated Financial Highlights for the six months ended June 30, 2024 as compared to the same period in 2023
- Revenue was $728.2 million, including Melissa & Doug Revenue of $83.7 million, an increase of 5.2% from $692.1 million. Revenue, excluding Melissa & Doug1 was $644.5 million, a decrease of 6.9% from $692.1 million.
- Revenue by operating segment reflected an increase of 6.5% in Toys, 12.2% in Entertainment and a decrease of 8.3% in Digital Games.
- Toy Gross Product Sales1 were $648.8 million, including Melissa & Doug Toy Gross Product Sales1 of $98.4 million, an increase of $42.5 million or 7.0% from $606.3 million. Toy Gross Product Sales, excluding Melissa & Doug1 were $550.4 million, a decrease of $55.9 million or 9.2% from $606.3 million.
- Operating Loss was $84.8 million compared to Operating Income of $28.3 million.
- Operating Margin2 was (11.6)% compared to 4.1%.
- Adjusted Operating Income1 was $9.1 million compared to $75.3 million. The decline in Adjusted Operating Income1 was primarily driven by a decrease of $57.0 million in Toys and $10.7 million in Digital Games, partially offset by an increase of $2.9 million in Entertainment.
- Adjusted Operating Margin1 was 1.2% compared to 10.9%.
- Net Loss was $79.3 million or $0.76 per share compared to Net Income of $26.1 million or $0.25 per share (diluted).
- Adjusted Net Loss1 was $9.9 million or $(0.10) per share compared to Adjusted Net Income1 of $61.1 million or $0.58 per share (diluted).
- Adjusted EBITDA1 was $72.2 million compared to $119.0 million, a decrease of $46.8 million. Adjusted EBITDA Margin1 was 9.9% compared to 17.2%.
- Adjusted EBITDA, excluding Melissa & Doug1 was $88.4 million compared to $119.0 million, a decrease of $30.6 million. Adjusted EBITDA Margin, excluding Melissa & Doug1 was 13.7% compared to 17.2%.
- Cash provided by operating activities was $49.7 million compared to $14.8 million.
- Free Cash Flow1 was $(4.2) million compared to $(40.3) million.
- The Company incurred $10.0 million in transaction related costs for the six months ended June 30, 2024.
- The Company recognized $1.4 million in Net Cost Synergies3 and continues to expect to achieve approximately $6 million in Net Cost Synergies3 in 2024.
- The Company repurchased and cancelled 1,111,581 subordinate voting shares for $25.9 million (C$35.2 million) through the NCIB program.
- The Company repaid $65.0 million of loans and borrowings (refer to the Liquidity section for further details).
2024 Outlook
The Company continues to expect for 2024:
- Toy Gross Product Sales, excluding Melissa & Doug1 to be in line with 2023.
- Revenue, excluding Melissa & Doug1, to be in line with 2023.
- Adjusted EBITDA Margin, excluding Melissa & Doug1 and Net Cost Synergies3 realized to be in line with 2023.
Incrementally, the Company continues to expect for 2024:
- Melissa & Doug Toy Gross Product Sales1 to be between $420 million to $430 million.
- Melissa & Doug Revenue to be between $370 million to $375 million.
- Melissa & Doug Adjusted EBITDA Margin1 of approximately 19.5%.
- To achieve in addition approximately $6 million in Net Cost Synergies3 towards the target of approximately $25 million to $30 million in Run-rate Net Cost Synergies3 by the end of 2026.
Consolidated Financial Results as compared to the same period in 2023
Effective January 2, 2024, Melissa & Doug’s operating results for the three and six months ended June 30, 2024 are included in the Company’s consolidated results.
|
(US$ millions, except per share information) |
Six Months Ended Jun 30 |
|||||
|
Q2 2024 |
Q2 2023 |
$ Change |
2024 |
2023 |
$ Change |
|
|
Consolidated Results |
||||||
|
Revenue4 |
$ 412.0 |
$ 420.7 |
$ (8.7) |
$ 728.2 |
$ 692.1 |
$ 36.1 |
|
Operating (Loss) Income |
$ (23.0) |
$ 34.4 |
$ (57.4) |
$ (84.8) |
$ 28.3 |
$ (113.1) |
|
Operating Margin2 |
(5.6) % |
8.2 % |
(11.6) % |
4.1 % |
||
|
Adjusted Operating Income1,3 |
$ 23.6 |
$ 62.6 |
$ (39.0) |
$ 9.1 |
$ 75.3 |
$ (66.2) |
|
Adjusted Operating Margin1 |
5.7 % |
14.9 % |
1.2 % |
10.9 % |
||
|
Net (Loss) Income |
$ (24.5) |
$ 28.0 |
$ (52.5) |
$ (79.3) |
$ 26.1 |
$ (105.4) |
|
Adjusted Net Income (Loss)1,3 |
$ 9.6 |
$ 48.8 |
$ (39.2) |
$ (9.9) |
$ 61.1 |
$ (71.0) |
|
Adjusted EBITDA1,3,4 |
$ 53.6 |
$ 88.4 |
$ (34.8) |
$ 72.2 |
$ 119.0 |
$ (46.8) |
|
Adjusted EBITDA Margin1 |
13.0 % |
21.0 % |
9.9 % |
17.2 % |
||
|
Earnings Per Share (“EPS”) |
||||||
|
Basic EPS |
$ (0.24) |
$ 0.27 |
$ (0.76) |
$ 0.25 |
||
|
Diluted EPS |
$ (0.24) |
$ 0.26 |
$ (0.76) |
$ 0.25 |
||
|
Adjusted Basic EPS1 |
$ 0.09 |
$ 0.47 |
$ (0.10) |
$ 0.59 |
||
|
Adjusted Diluted EPS1 |
$ 0.09 |
$ 0.45 |
$ (0.10) |
$ 0.58 |
||
|
Weighted average number of shares (in millions) |
||||||
|
Basic |
103.9 |
103.6 |
103.8 |
103.7 |
||
|
Diluted |
106.0 |
107.3 |
106.0 |
105.6 |
||
|
Selected Cash Flow Data |
||||||
|
Cash provided by operating activities |
$ 25.4 |
$ 19.1 |
$ 6.3 |
$ 49.7 |
$ 14.8 |
$ 34.9 |
|
Cash used in investing activities |
$ (27.4) |
$ (30.3) |
$ 2.9 |
$ (1,007.8) |
$ (86.9) |
$ (920.9) |
|
Cash (used in) provided by financing |
$ (49.0) |
$ (12.7) |
$ (36.3) |
$ 408.2 |
$ (27.5) |
$ 435.7 |
|
Free Cash Flow1 |
$ (3.6) |
$ (5.9) |
$ 2.3 |
$ (4.2) |
$ (40.3) |
$ 36.1 |
|
1 Non-GAAP financial measure or ratio. See “Non-GAAP Financial Measures and Ratios”. |
||||||
|
2 Operating Margin is calculated as Operating Income divided by Revenue. |
||||||
|
3 Refer to the “Reconciliation of Non-GAAP Financial Measures” section for further details on the adjustments. |
||||||
|
4 Included in the operating results of the three and six months ended June 30, 2024 is Melissa & Doug Revenue of $43.3 million and $83.7 million and Melissa & |
||||||
The following summarizes the impact of Melissa & Doug’s operating results on the three and six months ended June 30, 2024 consolidated results:
|
Six Months Ended Jun 30, |
||||
|
(US$ millions) |
Q2 2024 |
Q2 2023 |
2024 |
2023 |
|
Revenue |
412.0 |
420.7 |
728.2 |
692.1 |
|
Melissa & Doug Revenue |
43.3 |
— |
83.7 |
— |
|
Revenue, excluding Melissa & Doug1 |
368.7 |
420.7 |
644.5 |
692.1 |
|
Toys Gross Product Sales1 |
384.7 |
390.0 |
648.8 |
606.3 |
|
Melissa & Doug Toy Gross Product Sales1 |
51.7 |
— |
98.4 |
— |
|
Toys Gross Product Sales, excluding Melissa & Doug1 |
333.0 |
390.0 |
550.4 |
606.3 |
|
Adjusted EBITDA1 |
53.6 |
88.4 |
72.2 |
119.0 |
|
Melissa & Doug Adjusted EBITDA1 |
(7.0) |
— |
(16.2) |
— |
|
Adjusted EBITDA, excluding Melissa & Doug1 |
60.6 |
88.4 |
88.4 |
119.0 |
|
Adjusted EBITDA Margin1 |
13.0 % |
21.0 % |
9.9 % |
17.2 % |
|
Adjusted EBITDA Margin, excluding Melissa & Doug1 |
16.4 % |
21.0 % |
13.7 % |
17.2 % |
|
1 Non-GAAP financial measure or ratio. See “Non-GAAP Financial Measures and Ratios”. |
||||
Segmented Financial Results as compared to the same period in 2023
|
(US$ millions) |
Q2 2024 |
Q2 2023 |
||||||||
|
Toys |
Entertainment |
Digital |
Corporate |
Total |
Toys |
Entertainment |
Digital |
Corporate |
Total |
|
|
Revenue |
$ 340.9 |
$ 36.4 |
$ 34.7 |
$ — |
$ 412.0 |
$ 346.3 |
$ 33.9 |
$ 40.5 |
$ — |
$ 420.7 |
|
Operating (Loss) Income |
$ (34.9) |
$ 17.8 |
$ 4.3 |
$ (10.2) |
$ (23.0) |
$ 23.8 |
$ 15.7 |
$ 9.6 |
$ (14.7) |
34.4 |
|
Adjusted Operating Income (Loss)2 |
$ 1.3 |
$ 20.0 |
$ 5.9 |
$ (3.6) |
$ 23.6 |
$ 35.5 |
$ 16.3 |
$ 12.8 |
$ (2.0) |
$ 62.6 |
|
Adjusted EBITDA2 |
$ 20.9 |
$ 28.4 |
$ 7.9 |
$ (3.6) |
$ 53.6 |
$ 47.7 |
$ 28.0 |
$ 14.7 |
$ (2.0) |
$ 88.4 |
|
1 Corporate & Other includes certain corporate costs, foreign exchange and merger and acquisition-related costs, as well as fair value gains and losses. |
||||||||||
|
2 Non-GAAP financial measure or ratio. See “Non-GAAP Financial Measures and Ratios”. |
||||||||||
Toys Segment Results
The following table provides a summary of the Toys segment operating results, for the three months ended June 30, 2024 and 2023:
|
(US$ millions) |
Q2 2024 |
Q2 2023 |
$ Change |
% Change |
|
Preschool, Infant & Toddler and Plush1 |
$ 165.0 |
$ 164.9 |
$ 0.1 |
0.1 % |
|
Activities, Games & Puzzles and Dolls & Interactive |
$ 129.3 |
$ 109.7 |
$ 19.6 |
17.9 % |
|
Wheels & Action |
$ 75.7 |
$ 101.1 |
$ (25.4) |
(25.1) % |
|
Outdoor |
$ 14.7 |
$ 14.3 |
$ 0.4 |
2.8 % |
|
Toy Gross Product Sales2,5 |
$ 384.7 |
$ 390.0 |
$ (5.3) |
(1.4) % |
|
Sales Allowances3 |
$ (45.7) |
$ (43.7) |
$ (2.0) |
4.6 % |
|
Sales Allowances % of Toy Gross Product Sales2 |
11.9 % |
11.2 % |
0.7 % |
|
|
Toy Net Sales |
$ 339.0 |
$ 346.3 |
$ (7.3) |
(2.1) % |
|
Toy – Other Revenue |
$ 1.9 |
$ — |
$ 1.9 |
n.m. |
|
Toy Revenue |
$ 340.9 |
$ 346.3 |
$ (5.4) |
(1.6) % |
|
Toys Operating (Loss) Income |
$ (34.9) |
$ 23.8 |
$ (58.7) |
(246.6) % |
|
Toys Operating Margin4 |
(10.2) % |
6.9 % |
(17.1) % |
|
|
Toys Adjusted EBITDA2 |
$ 20.9 |
$ 47.7 |
$ (26.8) |
(56.2) % |
|
Toys Adjusted EBITDA Margin2 |
6.1 % |
13.8 % |
(7.7) % |
|
1 Melissa & Doug is included within the Preschool, Infant & Toddler and Plush product categories beginning from the date of acquisition. |
||||
|
2 Non-GAAP financial measure or ratio. See “Non-GAAP Financial Measures and Ratios”. |
||||
|
3 The Company enters arrangements to provide sales allowances requested by customers relating to cooperative advertising, contractual and negotiated |
||||
|
4 Operating Margin is calculated as segment Operating Income divided by segment Revenue. |
||||
|
5 Effective January 1, 2024, the Company has changed its product categories to align with the Company’s product offerings going forward. Prior year comparative |
|
(US$ millions) |
Q2 2024 |
Q2 2023 |
$ Change |
% Change |
|
Toy Revenue |
340.9 |
346.3 |
(5.4) |
(1.6) % |
|
Melissa & Doug Revenue |
43.3 |
— |
43.3 |
n.m. |
|
Toy Revenue, excluding Melissa & Doug1 |
297.6 |
346.3 |
(48.7) |
(14.1) % |
|
Toys Adjusted EBITDA1 |
20.9 |
47.7 |
(26.8) |
(56.2) % |
|
Melissa & Doug Adjusted EBITDA1 |
(7.0) |
— |
(7.0) |
n.m. |
|
Toys Adjusted EBITDA, excluding Melissa & Doug1 |
27.9 |
47.7 |
(19.8) |
(41.5) % |
|
Toys Adjusted EBITDA Margin1 |
6.1 % |
13.8 % |
||
|
Toys Adjusted EBITDA Margin, excluding Melissa & Doug1 |
9.4 % |
13.8 % |
||
|
1 Non-GAAP financial measure or ratio. See “Non-GAAP Financial Measures and Ratios”. |
||||
- Toy Revenue declined by $5.4 million or 1.6% to $340.9 million.
- Toy Gross Product Sales[i] was $384.7 million, a decrease of $5.3 million or 1.4% from $390.0 million, including Melissa & Doug Toy Gross Product Sales1 of $51.7 million. Toy Gross Product Sales1 was lower compared to the prior year primarily as a result of a shift in customer orders and shipments into the second half of 2024. In addition, Q2 2023 was supported by shipments related to the launch of PAW Patrol: The Mighty Movie. Toy Gross Product Sales, excluding Melissa & Doug1 was $333.0 million, an decrease of $57.0 million or 14.6% from $390.0 million.
- Sales Allowances increased by $2.0 million to $45.7 million. As a percentage of Toy Gross Product Sales1, Sales Allowances increased to 11.9% from 11.2%, due to market and customer mix.
- Toys Operating Loss was $34.9 million compared to Toy Operating Income of $23.8 million.
- Toys Operating Margin was (10.2)% compared to 6.9%.
- Toys Adjusted EBITDA Margin1 was 6.1% compared to 13.8%.
- Toys Adjusted EBITDA Margin, excluding Melissa & Doug1 was 9.4% compared to 13.8%.
- The decrease in Toys Operating Margin and Toys Adjusted EBITDA Margin1 was driven by the inclusion of Melissa & Doug, resulting in lower operating leverage due to the higher relative seasonality impact in the quarter, a change in product mix, higher proportion of administrative and marketing spend in relation to Toy Revenue, partially offset by a decrease in selling expense.
Entertainment Segment Results
The following table provides a summary of Entertainment segment operating results, for the three months ended June 30, 2024 and 2023:
|
(US$ millions) |
Q2 2024 |
Q2 2023 |
$ Change |
% Change |
|
Entertainment Revenue |
$ 36.4 |
$ 33.9 |
$ 2.5 |
7.4 % |
|
Entertainment Operating Income |
$ 17.8 |
$ 15.7 |
$ 2.1 |
13.4 % |
|
Entertainment Operating Margin |
48.9 % |
46.3 % |
2.6 % |
|
|
Entertainment Adjusted Operating Income1 |
$ 20.0 |
$ 16.3 |
$ 3.7 |
22.7 % |
|
Entertainment Adjusted Operating Margin1 |
54.9 % |
48.1 % |
6.8 % |
|
|
1 Non-GAAP financial measure or ratio. See “Non-GAAP Financial Measures and Ratios”. |
||||
- Entertainment Revenue increased by $2.5 million or 7.4% to $36.4 million, from higher distribution revenue associated with on-going distribution of PAW Patrol: The Mighty Movie and the PAW Patrol series, partially offset by fewer Entertainment content deliveries in the current year for Unicorn Academy and Vida the Vet.
- Entertainment Operating Income increased by $2.1 million or 13.4% to $17.8 million. Entertainment Adjusted Operating Income1 increased by $3.7 million or 22.7% to $20.0 million from $16.3 million, from higher distribution revenue and the accretive effect of fewer Entertainment content deliveries in the current year relative to the same quarter in the prior year, partially offset by higher marketing costs for Entertainment content.
- Entertainment Operating Margin increased to 48.9% from 46.3% and Entertainment Adjusted Operating Margin1 increased to 54.9% from 48.1%, from higher distribution revenue and the accretive effect of fewer Entertainment content deliveries in the current year.
Digital Games Segment Results
The following table provides a summary of Digital Games segment operating results, for the three months ended June 30, 2024 and 2023:
|
(US$ millions) |
Q2 2024 |
Q2 2023 |
$ Change |
% Change |
|
Digital Games Revenue |
$ 34.7 |
$ 40.5 |
$ (5.8) |
(14.3) % |
|
Digital Games Operating Income |
$ 4.3 |
$ 9.6 |
$ (5.3) |
(55.2) % |
|
Digital Games Operating Margin |
12.4 % |
23.7 % |
(11.3) % |
|
|
Digital Games Adjusted Operating Income1 |
$ 5.9 |
$ 12.8 |
$ (6.9) |
(53.9) % |
|
Digital Games Adjusted Operating Margin1 |
17.0 % |
31.6 % |
(14.6) % |
|
|
1 Non-GAAP financial measure or ratio. See “Non-GAAP Financial Measures and Ratios”. |
||||
- Digital Games Revenue declined by $5.8 million or 14.3% to $34.7 million primarily due to lower in-game purchases in Toca Life World. While the number of monthly active users for Toca Life World has remained steady, the current macroeconomic environment has led to reduced spending per user. The decline was offset in part by higher subscription revenue from Piknik and PAW Patrol Academy.
- Digital Games Operating Income decreased by $5.3 million or 55.2% to $4.3 million. Digital Games Adjusted Operating Income1 decreased by $6.9 million or 53.9% to $5.9 million from $12.8 million. Digital Games Operating Margin decreased from 23.7% to 12.4% and Digital Games Adjusted Operating Margin1 decreased from 31.6% to 17.0%.
- The decrease in Digital Games Operating Income, Adjusted Operating Income1, Operating Margin and Adjusted Operating Margin1 was due to the decline in revenue and increased investments in marketing for Piknik and PAW Patrol Academy.
Liquidity
The Company has an unsecured revolving credit facility (the “Facility”) with a borrowing capacity of $510.0 million which matures on September 28, 2026, and contains certain financial covenants.
The Company has a non-revolving credit facility (the “Acquisition Facility”) for the acquisition of Melissa & Doug, with a borrowing capacity of $225.0 million which matures on November 19, 2024, and contains certain financial covenants.
As at June 30, 2024, there was $235.0 million drawn (December 31, 2023 – $nil) under the Facility and $225.0 million drawn (December 31, 2023 – $nil) under the Acquisition Facility. For the six months ended June 30, 2024, the weighted average interest rate on the Facility and the Acquisition Facility were both 6.6% (2023 – 0%).
As at June 30, 2024, the Company had unutilized liquidity of $426.0 million, comprised of $154.6 million in Cash and $271.4 million under the Company’s credit facilities.
Cash Flows
For the six months ended June 30, 2024, cash flow provided by operating activities was $49.7 million compared to $14.8 million. The increase was driven by the change in non-cash working capital offset by lower Adjusted Operating Income1. Change in non-cash working capital increased by $81.9 million, due to decreases of $185.0 million in trade receivables, $6.2 million in inventories and $10.4 million in other receivables, partially offset by an increase of $83.4 million in trade payables and accrued liabilities.
For the six months ended June 30, 2024, cash flow provided by financing activities was $408.2 million, compared to cash flow used of $27.5 million. The increase is primarily driven by the proceeds from loans and borrowings of $525.0 million, partially offset by repayments of $65.0 million.
For the six months ended June 30, 2024, Free Cash Flow1 was $(4.2) million compared to $(40.3) million, due to higher cash flow provided by operating activities and lower cash flow used in investing activities.
Capitalization
The Company’s Board of Directors declared a dividend of C$0.12 per outstanding subordinate voting share and multiple voting share, payable on October 11, 2024 to shareholders of record at the close of business on September 27, 2024. The dividend is designated to be an eligible dividend for purposes of section 89(1) of the Income Tax Act (Canada).
The weighted average basic and diluted shares outstanding as at June 30, 2024 were 103.8 million and 106.0 million, compared to 103.7 million and 105.6 million in the prior year, respectively.
During the six months ended June 30, 2024, the Company repurchased and cancelled, through the Company’s NCIB program, 1,111,581 (2023 – 397,700 shares) subordinate voting shares for $25.9 million (C$35.2 million) (2023 – $10.5 million). Subsequent to June 30, 2024, the Company repurchased and cancelled 318,200 subordinate voting shares for $6.9 million (C$9.5 million).
|
1 Non-GAAP financial measure or ratio. See “Non-GAAP Financial Measures and Ratios”. |
|
2 Operating Margin is calculated as Operating Income divided by Revenue. |
|
3 Supplementary financial measure. See “Supplementary Financial Measures”. |
Spin Master Corp.
Condensed consolidated interim statements of financial position
|
Jun 30, |
Dec 31, |
|
|
(Unaudited, in US$ millions) |
2024 |
2023 |
|
Assets |
||
|
Current assets |
||
|
Cash and cash equivalents |
154.6 |
705.7 |
|
Restricted cash |
3.1 |
— |
|
Trade receivables, net |
315.7 |
414.4 |
|
Other receivables |
57.8 |
60.0 |
|
Inventories, net |
275.4 |
98.0 |
|
Income tax receivable |
68.4 |
— |
|
Prepaid expenses and other assets |
39.2 |
40.9 |
|
914.2 |
1,319.0 |
|
|
Non-current assets |
||
|
Intangible assets |
825.0 |
281.3 |
|
Goodwill |
378.7 |
165.9 |
|
Right-of-use assets |
168.6 |
53.6 |
|
Property, plant and equipment |
66.3 |
32.6 |
|
Deferred income tax assets |
160.1 |
110.8 |
|
Other assets |
36.4 |
26.5 |
|
1,635.1 |
670.7 |
|
|
Total assets |
2,549.3 |
1,989.7 |
|
Liabilities |
||
|
Current liabilities |
||
|
Trade payables and accrued liabilities |
364.4 |
385.4 |
|
Loans and borrowings |
458.4 |
— |
|
Provisions |
23.9 |
32.1 |
|
Lease liabilities |
32.2 |
11.4 |
|
Deferred revenue |
13.7 |
11.0 |
|
Income tax payable |
— |
6.6 |
|
892.6 |
446.5 |
|
|
Non-current liabilities |
||
|
Deferred income tax liabilities |
225.1 |
59.1 |
|
Lease liabilities |
127.6 |
50.7 |
|
Provisions |
11.5 |
14.3 |
|
364.2 |
124.1 |
|
|
Total liabilities |
1,256.8 |
570.6 |
|
Shareholders’ equity |
||
|
Share capital |
776.6 |
783.4 |
|
Retained earnings |
487.0 |
604.5 |
|
Contributed surplus |
34.0 |
27.4 |
|
Accumulated other comprehensive (loss) income |
(5.1) |
3.8 |
|
Total shareholders’ equity |
1,292.5 |
1,419.1 |
|
Total liabilities and shareholders’ equity |
2,549.3 |
1,989.7 |
Spin Master Corp.
Condensed consolidated interim statements of (loss) earnings and comprehensive (loss) income
|
Six Months Ended Jun 30, |
||||
|
(Unaudited, in US$ millions, except earnings per share) |
Q2 2024 |
Q2 2023 |
2024 |
2023 |
|
Revenue |
412.0 |
420.7 |
728.2 |
692.1 |
|
Cost of sales |
212.4 |
189.7 |
372.1 |
302.6 |
|
Gross Profit |
199.6 |
231.0 |
356.1 |
389.5 |
|
Expenses |
||||
|
Selling, general and administrative |
200.3 |
179.5 |
398.0 |
328.8 |
|
Depreciation and amortization |
15.3 |
5.7 |
35.1 |
12.3 |
|
Other expense, net |
2.2 |
— |
3.4 |
4.4 |
|
Foreign exchange loss, net |
4.8 |
11.4 |
4.4 |
15.7 |
|
Operating (Loss) Income |
(23.0) |
34.4 |
(84.8) |
28.3 |
|
Interest income |
(1.1) |
(6.5) |
(2.4) |
(13.2) |
|
Interest expense |
12.2 |
3.3 |
25.0 |
6.4 |
|
(Loss) Income before income tax (recovery) expense |
(34.1) |
37.6 |
(107.4) |
35.1 |
|
Income tax (recovery) expense |
(9.6) |
9.6 |
(28.1) |
9.0 |
|
Net (Loss) Income |
(24.5) |
28.0 |
(79.3) |
26.1 |
|
(Loss) Earnings per share |
||||
|
Basic |
(0.24) |
0.27 |
(0.76) |
0.25 |
|
Diluted |
(0.24) |
0.26 |
(0.76) |
0.25 |
|
Weighted average number of shares (in millions) |
||||
|
Basic |
103.9 |
103.6 |
103.8 |
103.7 |
|
Diluted |
106.0 |
107.3 |
106.0 |
105.6 |
|
Six Months Ended Jun 30, |
||||
|
(Unaudited, in US$ millions) |
Q2 2024 |
Q2 2023 |
2024 |
2023 |
|
Net (Loss) Income |
(24.5) |
28.0 |
(79.3) |
26.1 |
|
Items that may be subsequently reclassified to Net (Loss) Income |
||||
|
Foreign currency translation (loss) gain |
(1.9) |
17.7 |
(8.9) |
20.3 |
|
Other comprehensive (loss) income |
(1.9) |
17.7 |
(8.9) |
20.3 |
|
Total comprehensive (loss) income |
(26.4) |
45.7 |
(88.2) |
46.4 |
Spin Master Corp.
Condensed consolidated interim statements of cash flows
|
Six Months Ended Jun 30, |
||
|
(Unaudited, in US$ millions) |
2024 |
2023 |
|
Operating activities |
||
|
Net (Loss) Income |
(79.3) |
26.1 |
|
Adjustments to reconcile net loss to cash provided by operating activities |
||
|
Income tax (recovery) expense |
(28.1) |
9.0 |
|
Interest expense |
18.9 |
— |
|
Interest income |
(2.4) |
(13.2) |
|
Depreciation and amortization |
66.6 |
43.7 |
|
Loss on disposal of non-current assets |
0.3 |
0.7 |
|
Interest and accretion expense |
5.4 |
2.6 |
|
Amortization of Facility fee costs |
0.7 |
0.2 |
|
Gain on investment in limited partnership, net |
0.3 |
(0.2) |
|
Impairment of non-current assets |
2.1 |
3.4 |
|
Unrealized foreign exchange (gain) loss, net |
(0.7) |
26.2 |
|
Share-based compensation expense |
13.5 |
10.1 |
|
Net changes in non-cash working capital |
81.9 |
(60.5) |
|
Net change in non-cash provisions and other assets |
(23.0) |
4.5 |
|
Fair value adjustment on inventory sold |
44.7 |
— |
|
Income taxes paid |
(41.8) |
(51.3) |
|
Income taxes received |
3.7 |
0.2 |
|
Interest (paid) received |
(13.1) |
13.3 |
|
Cash provided by operating activities |
49.7 |
14.8 |
|
Investing activities |
||
|
Investment in property, plant and equipment |
(17.8) |
(14.1) |
|
Investment in intangible assets |
(37.1) |
(44.3) |
|
Business acquisitions, net of cash acquired |
(952.9) |
(26.5) |
|
Minority interest and other investments |
— |
(2.0) |
|
Cash used in investing activities |
(1,007.8) |
(86.9) |
|
Financing activities |
||
|
Proceeds from loans and borrowings |
525.0 |
— |
|
Repayment of loans and borrowings |
(65.0) |
— |
|
Payment of lease liabilities |
(17.0) |
(7.8) |
|
Dividends paid |
(9.2) |
(9.2) |
|
Repurchase of subordinate voting shares |
(25.6) |
(10.5) |
|
Cash provided by (used in) financing activities |
408.2 |
(27.5) |
|
Effect of foreign currency exchange rate changes on cash |
(1.2) |
10.2 |
|
Net decrease in cash during the period |
(551.1) |
(89.4) |
|
Cash, beginning of period |
705.7 |
644.3 |
|
Cash, end of period |
154.6 |
554.9 |
|
(in US$ millions) |
Q2 2024 |
Q2 2023 |
$ Change |
% Change |
|
|
Operating (Loss) Income |
(23.0) |
34.4 |
(57.4) |
(166.9) % |
|
|
Adjustments: |
|||||
|
Fair value adjustment for inventories acquired1 |
24.2 |
— |
24.2 |
n.m. |
|
|
Transaction and integration costs2 |
6.3 |
1.5 |
4.8 |
320.0 % |
|
|
Share based compensation3 |
6.2 |
4.8 |
1.4 |
29.2 % |
|
|
Foreign exchange loss4 |
4.8 |
11.4 |
(6.6) |
(57.9) % |
|
|
Amortization of intangible assets acquired5 |
1.8 |
— |
1.8 |
n.m. |
|
|
Impairment of intangible assets6 |
1.8 |
1.0 |
0.8 |
80.0 % |
|
|
Acquisition related deferred incentive compensation7 |
1.1 |
2.1 |
(1.0) |
(47.6) % |
|
|
Restructuring and other related costs8 |
0.5 |
9.7 |
(9.2) |
(94.8) % |
|
|
Net unrealized loss (gain) on investment9 |
0.4 |
(0.3) |
0.7 |
(233.3) % |
|
|
Net realized loss on investment10 |
— |
0.1 |
(0.1) |
(100.0) % |
|
|
Acquisition related contingent consideration11 |
(0.5) |
(2.1) |
1.6 |
(76.2) |
|
|
Adjusted Operating (Loss) Income |
23.6 |
62.6 |
(39.0) |
(62.3) % |
|
|
Depreciation and amortization12 |
30.0 |
25.8 |
4.2 |
16.3 % |
|
|
Adjusted EBITDA |
53.6 |
88.4 |
(34.8) |
(39.4) % |
|
|
Income tax recovery (expense) |
9.6 |
(9.6) |
19.2 |
(200.0) % |
|
|
Interest (expense) income |
(11.1) |
3.2 |
(14.3) |
(446.9) % |
|
|
Depreciation and amortization12 |
(30.0) |
(25.8) |
(4.2) |
16.3 % |
|
|
Tax effect of normalization adjustments13 |
(12.5) |
(7.4) |
(5.1) |
68.9 % |
|
|
Adjusted Net Income |
9.6 |
48.8 |
(39.2) |
(80.3) % |
|
|
Cash provided by operating activities |
25.4 |
19.1 |
6.3 |
33.0 % |
|
|
Cash used in investing activities |
(27.4) |
(30.3) |
2.9 |
(9.6) % |
|
|
Add: |
|||||
|
Cash (used in) provided by business acquisitions, asset acquisitions, investment |
(1.6) |
5.3 |
(6.9) |
(130.2) % |
|
|
Free Cash Flow |
(3.6) |
(5.9) |
2.3 |
(39.0) % |
|
|
_________________________________ |
|
1 Relates to fair value adjustment to Melissa & Doug inventory recorded as part of the acquisition on January 2, 2024. |
|
2 Professional fees and integration costs incurred relating to acquisitions (including Melissa & Doug), including $0.5 million of transaction costs. |
|
3 Related to non-cash expenses associated with the Company’s long-term incentive plan and the mark to market (gain)/loss related to DSUs. |
|
4 Includes foreign exchange losses (gains) generated by the translation and settlement of monetary assets/liabilities denominated in a currency other than the functional currency of the applicable entity and losses (gains) related to the Company’s hedging programs. |
|
5 Relates to the amortization of intangible assets acquired with Melissa & Doug. |
|
6 Impairment of intangible assets related to content development projects and computer software. |
|
7 Deferred incentive compensation associated with acquisitions. |
|
8 Restructuring expense in the prior year primarily relates to changes in personnel. |
|
9 Net unrealized loss (gain) related to investment in limited partnership. |
|
10 Net realized loss related to investment in limited partnership. |
|
11 Recovery associated with contingent consideration for acquisitions. |
|
12 Depreciation and amortization for the calculation of Adjusted EBITDA excludes $1.8 million of amortization of intangible assets acquired with Melissa & Doug. |
|
13 Tax effect of adjustments (Footnotes 1-11). Adjustments are tax effected at the effective tax rate of the given period. |
The following table presents a reconciliation of Operating (Loss) Income to Adjusted Operating Income, Adjusted EBITDA, Adjusted Net Income, and cash from operating activities to Free Cash Flow for the six months ended June 30, 2024 and 2023:
|
Six Months Ended Jun 30 |
|||||
|
(in US$ millions) |
2024 |
2023 |
$ Change |
% Change |
|
|
Operating (Loss) Income |
(84.8) |
28.3 |
(113.1) |
(399.6) % |
|
|
Adjustments: |
|||||
|
Fair value adjustment for inventories acquired1 |
44.8 |
— |
44.8 |
n.m. |
|
|
Transaction and integration costs2 |
23.0 |
2.1 |
20.9 |
995.2 % |
|
|
Share based compensation3 |
12.3 |
10.2 |
2.1 |
20.6 % |
|
|
Foreign exchange loss4 |
4.4 |
15.7 |
(11.3) |
(72.0) % |
|
|
Restructuring and other related costs5 |
3.5 |
13.5 |
(10.0) |
(74.1) % |
|
|
Amortization of intangible assets acquired6 |
3.5 |
— |
3.5 |
n.m. |
|
|
Acquisition related deferred incentive compensation7 |
2.6 |
4.2 |
(1.6) |
(38.1) % |
|
|
Impairment of intangible assets8 |
1.8 |
2.2 |
(0.4) |
(18.2) |
|
|
Net unrealized loss (gain) on investment9 |
0.4 |
(0.3) |
0.7 |
(233.3) % |
|
|
Impairment of property, plant and equipment10 |
0.3 |
0.2 |
0.1 |
50.0 |
|
|
Impairment of goodwill11 |
— |
1.0 |
(1.0) |
(100.0) |
|
|
Net realized loss on investment12 |
— |
0.1 |
(0.1) |
(100.0) % |
|
|
Legal settlement (recovery) expense |
(0.6) |
0.2 |
(0.8) |
(400.0) % |
|
|
Acquisition related contingent consideration13 |
(2.1) |
(2.1) |
— |
— % |
|
|
Adjusted Operating Income |
9.1 |
75.3 |
(66.2) |
(87.9) % |
|
|
Depreciation and amortization14 |
63.1 |
43.7 |
19.4 |
44.4 % |
|
|
Adjusted EBITDA |
72.2 |
119.0 |
(46.8) |
(39.3) % |
|
|
Income tax recovery (expense) |
28.1 |
(9.0) |
37.1 |
(412.2) % |
|
|
Interest (expense) income |
(22.6) |
6.8 |
(29.4) |
(432.4) % |
|
|
Depreciation and amortization14 |
(63.1) |
(43.7) |
(19.4) |
44.4 % |
|
|
Tax effect of adjustments15 |
(24.5) |
(12.0) |
(12.5) |
104.2 % |
|
|
Adjusted Net (Loss) Income |
(9.9) |
61.1 |
(71.0) |
(116.2) % |
|
|
Cash provided by operating activities |
49.7 |
14.8 |
34.9 |
235.8 % |
|
|
Cash used in investing activities |
(1,007.8) |
(86.9) |
(920.9) |
1,059.7 % |
|
|
Add: |
|||||
|
Cash (used in) provided by business acquisitions, asset acquisitions, investment in |
953.9 |
31.8 |
922.1 |
2,899.7 % |
|
|
Free Cash Flow |
(4.2) |
(40.3) |
36.1 |
(89.6) % |
|
|
__________________________________ |
|
1 Relates to fair value adjustment to Melissa & Doug inventory recorded as part of the acquisition on January 2, 2024. |
|
2 Professional fees and integration costs incurred relating to acquisitions (including Melissa & Doug), including $10.0 million of transaction costs. |
|
3 Related to non-cash expenses associated with the Company’s long-term incentive plan and the mark to market (gain)/loss related to DSUs. |
|
4 Includes foreign exchange losses (gains) generated by the translation and settlement of monetary assets/liabilities denominated in a currency other than the functional currency of the applicable entity and losses (gains) related to the Company’s hedging programs. |
|
5 Restructuring expense in the prior year primarily relates to changes in personnel. |
|
6 Relates to the amortization of intangible assets acquired with Melissa & Doug. |
|
7 Related to non-cash expenses associated with the Company’s share option expense and long-term incentive plan. |
|
8 Impairment of intangible assets related to content development projects and computer software. |
|
9 Net unrealized gain related to investment in limited partnership. |
|
10 Impairment of property, plant and equipment related to tooling. |
|
11 Prior year impairment of goodwill associated with one CGU. |
|
12 Net realized loss related to investment in limited partnership. |
|
13 Expense associated with contingent consideration for acquisitions. |
|
14 Depreciation and amortization for the calculation of Adjusted EBITDA excludes $3.5 million of amortization of intangible assets acquired with Melissa & Doug. |
|
15 Tax effect of adjustments (Footnotes 1-13). Adjustments are tax effected at the effective tax rate of the given period. |
Segment Results
The Company’s results from operations by reportable segment for the three months ended June 30, 2024 and 2023 are as follows:
|
(US$ millions) |
Q2 2024 |
Q2 2023 |
||||||||
|
Toys |
Entertainment |
Digital |
Corporate |
Total |
Toys |
Entertainment |
Digital |
Corporate |
Total |
|
|
Revenue |
340.9 |
36.4 |
34.7 |
— |
412.0 |
346.3 |
33.9 |
40.5 |
— |
420.7 |
|
Operating (Loss) Income |
(34.9) |
17.8 |
4.3 |
(10.2) |
(23.0) |
23.8 |
15.7 |
9.6 |
(14.7) |
34.4 |
|
Adjusting items: |
||||||||||
|
Fair value adjustment for inventories |
24.2 |
— |
— |
— |
24.2 |
— |
— |
— |
— |
— |
|
Transaction and integration costs3 |
4.3 |
— |
— |
2.0 |
6.3 |
— |
— |
— |
1.5 |
1.5 |
|
Share based compensation |
5.5 |
0.4 |
0.9 |
(0.6) |
6.2 |
3.8 |
0.4 |
0.9 |
(0.3) |
4.8 |
|
Foreign exchange loss |
— |
— |
— |
4.8 |
4.8 |
— |
— |
— |
11.4 |
11.4 |
|
Restructuring and other related costs |
0.5 |
— |
— |
— |
0.5 |
9.3 |
— |
0.4 |
— |
9.7 |
|
Amortization of intangible assets acquired |
1.8 |
— |
— |
— |
1.8 |
— |
— |
— |
— |
— |
|
Impairment of intangible assets |
— |
1.8 |
— |
— |
1.8 |
— |
0.2 |
0.5 |
0.3 |
1.0 |
|
Acquisition related deferred incentive |
0.4 |
— |
0.7 |
— |
1.1 |
0.7 |
— |
1.4 |
— |
2.1 |
|
Net unrealized loss (gain) on investment |
— |
— |
— |
0.4 |
0.4 |
— |
— |
— |
(0.3) |
(0.3) |
|
Net realized gain on investment |
— |
— |
— |
— |
— |
— |
— |
— |
0.1 |
0.1 |
|
Acquisition related contingent consideration |
(0.5) |
— |
— |
— |
(0.5) |
(2.1) |
— |
— |
— |
(2.1) |
|
Adjusted Operating Income (Loss)4 |
1.3 |
20.0 |
5.9 |
(3.6) |
23.6 |
35.5 |
16.3 |
12.8 |
(2.0) |
62.6 |
|
Adjusted Operating Margin4 |
0.4 % |
54.9 % |
17.0 % |
n.m. |
5.7 % |
10.3 % |
48.1 % |
31.6 % |
n.m. |
14.9 % |
|
Depreciation and amortization5 |
19.6 |
8.4 |
2.0 |
— |
30.0 |
12.2 |
11.7 |
1.9 |
— |
25.8 |
|
Adjusted EBITDA4 |
20.9 |
28.4 |
7.9 |
(3.6) |
53.6 |
47.7 |
28.0 |
14.7 |
(2.0) |
88.4 |
|
Adjusted EBITDA Margin4 |
6.1 % |
78.0 % |
22.8 % |
n.m. |
13.0 % |
13.8 % |
82.6 % |
36.3 % |
n.m. |
21.0 % |
|
1 Corporate & Other includes certain corporate costs, foreign exchange and merger and acquisition-related costs, as well as fair value gains and losses. |
||||||||||
|
2 Relates to the fair value adjustment to Melissa & Doug’s inventory recorded as part of the acquisition on January 2, 2024. |
||||||||||
|
3 Professional fees and integration costs incurred relating to acquisitions (including Melissa & Doug), including $0.5 million of transaction costs. |
||||||||||
|
4 Non-GAAP financial measure or ratio. See “Non-GAAP Financial Measures and Ratios”. |
||||||||||
|
5 Depreciation and amortization for the calculation of adjusted EBITDA excludes $1.8 million (Q2 2023 – $nil) of amortization of intangible assets acquired with Melissa & Doug. |
The following table presents a reconciliation of Melissa & Doug’s Operating Income to Adjusted EBITDA for the three and six months ended June 30, 2024:
|
(US$ millions) |
Q2 2024 |
YTD Q2 2024 |
|
Melissa & Doug Toy Gross Product Sales2 |
51.7 |
98.4 |
|
Melissa & Doug Sales Allowance |
(8.4) |
(14.7) |
|
Melissa & Doug Revenue |
43.3 |
83.7 |
|
Operating Loss |
(16.5) |
(35.6) |
|
Depreciation and amortization |
5.0 |
13.3 |
|
EBITDA |
(11.5) |
(22.3) |
|
Adjustments1 |
4.5 |
6.1 |
|
Melissa & Doug Adjusted EBITDA2 |
(7.0) |
(16.2) |
|
Melissa & Doug Adjusted EBITDA Margin2 |
(16.2) % |
(19.4) % |
|
1 Includes foreign exchange (gain) loss, restructuring and other related costs, and transaction and integration costs. |
||
|
2 Non-GAAP financial measure or ratio. See “Non-GAAP Financial Measures and Ratios”. |
||
The following table presents a reconciliation of Revenue to Revenue, excluding Melissa & Doug, Toy Gross Product Sales to Toy Gross Product Sales, excluding Melissa & Doug, Consolidated Adjusted EBITDA to Adjusted EBITDA, excluding Melissa & Doug, Toy Revenue to Toy Revenue, excluding Melissa & Doug, and Toys Adjusted EBITDA to Toys Adjusted EBITDA, excluding Melissa & Doug for the three and six months ended June 30, 2024:
|
(US$ millions) |
Q2 2024 |
Q2 2023 |
$ Change |
% Change |
|
Revenue |
412.0 |
420.7 |
(8.7) |
(2.1) % |
|
Melissa & Doug Revenue |
43.3 |
— |
43.3 |
n.m. |
|
Revenue, excluding Melissa & Doug1 |
368.7 |
420.7 |
(52.0) |
(12.4) % |
|
Toys Gross Product Sales1 |
384.7 |
390.0 |
(5.3) |
(1.4) % |
|
Melissa & Doug Toy Gross Product Sales1 |
51.7 |
— |
51.7 |
n.m. |
|
Toys Gross Product Sales, excluding Melissa & Doug1 |
333.0 |
390.0 |
(57.0) |
(14.6) % |
|
Adjusted EBITDA1 |
53.6 |
88.4 |
(34.8) |
(39.4) % |
|
Melissa & Doug Adjusted EBITDA1 |
(7.0) |
— |
(7.0) |
n.m. |
|
Adjusted EBITDA, excluding Melissa & Doug1 |
60.6 |
88.4 |
(27.8) |
(31.4) % |
|
Adjusted EBITDA Margin, excluding Melissa & Doug1 |
16.4 % |
21.0 % |
||
|
Toy Revenue |
340.9 |
346.3 |
(5.4) |
(1.6) % |
|
Melissa & Doug Revenue |
43.3 |
— |
43.3 |
n.m. |
|
Toy Revenue, excluding Melissa & Doug1 |
297.6 |
346.3 |
(48.7) |
(14.1) % |
|
Toys Adjusted EBITDA1 |
20.9 |
47.7 |
(26.8) |
(56.2) % |
|
Toys Adjusted EBITDA Margin1 |
6.1 % |
13.8 % |
||
|
Toys Adjusted EBITDA, excluding Melissa & Doug1 |
27.9 |
47.7 |
(19.8) |
(41.5) % |
|
Toys Adjusted EBITDA Margin, excluding Melissa & Doug1 |
9.4 % |
13.8 % |
||
|
1 Non-GAAP financial measure or ratio. See “Non-GAAP Financial Measures and Ratios”. |
||||
|
Six Months Ended Jun 30, |
||||
|
(US$ millions) |
2024 |
2023 |
$ Change |
% Change |
|
Revenue |
728.2 |
692.1 |
36.1 |
5.2 % |
|
Melissa & Doug Revenue |
83.7 |
— |
83.7 |
n.m. |
|
Revenue, excluding Melissa & Doug1 |
644.5 |
692.1 |
(47.6) |
(6.9) % |
|
Toys Gross Product Sales1 |
648.8 |
606.3 |
42.5 |
7.0 % |
|
Melissa & Doug Toy Gross Product Sales1 |
98.4 |
— |
98.4 |
n.m. |
|
Toys Gross Product Sales, excluding Melissa & Doug1 |
550.4 |
606.3 |
(55.9) |
(9.2) % |
|
Adjusted EBITDA1 |
72.2 |
119.0 |
(46.8) |
(39.3) % |
|
Melissa & Doug Adjusted EBITDA1 |
(16.2) |
— |
(16.2) |
n.m. |
|
Adjusted EBITDA, excluding Melissa & Doug1 |
88.4 |
119.0 |
(30.6) |
(25.7) % |
|
Adjusted EBITDA Margin, excluding Melissa & Doug1 |
13.7 % |
17.2 % |
||
|
Toy Revenue |
567.3 |
532.6 |
34.7 |
6.5 % |
|
Melissa & Doug Revenue |
83.7 |
— |
83.7 |
n.m. |
|
Toy Revenue, excluding Melissa & Doug1 |
483.6 |
532.6 |
(49.0) |
(9.2) % |
|
Toys Adjusted EBITDA1 |
(11.6) |
26.3 |
(37.9) |
(144.1) % |
|
Toys Adjusted EBITDA Margin1 |
(2.0) % |
4.9 % |
||
|
Toys Adjusted EBITDA, excluding Melissa & Doug1 |
4.6 |
26.3 |
(21.7) |
(82.5) % |
|
Toys Adjusted EBITDA Margin, excluding Melissa & Doug1 |
1.0 % |
4.9 % |
||
|
1 Non-GAAP financial measure or ratio. See “Non-GAAP Financial Measures and Ratios”. |
||||
ADDENDUM
Effective January 1, 2024, Spin Master has changed its product categories to align with the Company’s product offerings going forward. The following table restates 2023 Toy Gross Product Sales[30] in the same format that the Company presents Toy Gross Product Sales1 in 2024:
|
(US$ millions) |
Q1 2023 |
Q2 2023 |
Q3 2023 |
Q4 2023 |
Total |
|
Preschool, Infant & Toddler and Plush |
$ 82.6 |
$ 164.9 |
$ 301.4 |
$ 169.3 |
$ 718.2 |
|
Activities, Games & Puzzles and Dolls & Interactive |
$ 62.6 |
$ 109.7 |
$ 218.7 |
$ 196.0 |
$ 587.0 |
|
Wheels & Action |
$ 43.7 |
$ 101.1 |
$ 151.2 |
$ 113.3 |
$ 409.3 |
|
Outdoor |
$ 27.4 |
$ 14.3 |
$ 7.3 |
$ 23.7 |
$ 72.7 |
|
Gross Product Sales1 |
$ 216.3 |
$ 390.0 |
$ 678.6 |
$ 502.3 |
$ 1,787.2 |
SOURCE Spin Master Corp.
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