17th Jan 2020 08:46
(Alliance News) - Toy maker Character Group PLC on Friday warned full-year profit will be below market expectations following an "extremely challenging" Christmas period.
Character shares were 18% at 310.50 pence each in London on Friday morning.
Ahead of its annual general meeting on Friday, Character said the toy market in the UK contracted for the second year in-a-row, hurting both Christmas sales and half-year numbers.
The bleak update comes just over two weeks after FTSE 100-listed grocer J Sainsbury's PLC also reported the UK's "toy and gaming markets declined year-on-year".
Character said: "The 2019 Christmas trading period was extremely challenging with the total toy market in the UK contracting for the second successive year.
"Sales of our core products were down against the comparable period last year. Nevertheless they performed well with good sell through at retail in the UK."
For the year ending August 31, Character expects pretax profit to be roughly GBP10 million, not only below market expectations but potentially 9.9% lower at GBP11.1 million than last year.
The company does however expect a stronger last six months of financial 2020, anticipating one if its "strongest second half performances to date".
Character said: "Our confidence for the second half has been boosted by the reactions from our customers to recent product previews and presentations. With further viewing opportunities and product launches planned for the London Toy Fair, we expect the momentum to continue."
By Eric Cunha; [email protected]
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