Copenhagen (AFP) – Lego, the world’s biggest toy maker by revenue, posted “stronger than expected” earnings for the first half of the year, its chief executive told AFP, with net profit rising 32 percent. “It has been stronger than expected in the first half across the board,” Niels Christiansen said, adding that the family-owned Danish company expected double-digit growth for the full-year. “It’s not one particular market, it’s not one particular product or theme or thing,” he said.
Lego registered a net profit of 8.6 billion Danish kroner ($1.34 billion), up 32 percent from a year earlier, while revenue jumped by 26 percent at constant exchange rates to 41.9 billion kroner. “We’re seeing profit higher than that of expectations at the beginning of the year,” Christiansen said.
But he noted that Lego, whose name is a contraction of the Danish for “play well” (“leg godt”), has struggled to win over Chinese consumers. “The Chinese market is just very difficult. The consumers are a little bit reluctant to spend,” he said.
The share of renewable and recycled materials bought and used to make the colourful plastic bricks continues to grow, Lego said, without providing specific numbers. But Christiansen said the higher cost was not being passed on to consumers. “We take on that cost ourselves,” he said, adding that rising prices for oil, a key component in plastic, had also not affected the price of Lego’s bricks.
“We can manage it. It doesn’t destroy profitability,” he said. “The growth helps us, because when you grow faster, there are opportunities to utilise your factories better, to be more productive in what you do.”
© 2024 AFP
