22nd Dec 2022 12:10
(Alliance News) - Character Group PLC on Thursday said annual profit declined by a quarter, despite a rise in revenue, and the designer, developer and distributor of toys, games and giftware warned of slowing sales in the lead-up to Christmas.
Character Group shares were down 0.7% at 420.25 pence at midday in London on Thursday. The stock is down 33% in the past year.
In the financial year that ended August 31, pretax profit fell 25% to GBP11.4 million from GBP15.3 million, even as revenue rose by 26% to GBP176.4 million from GBP140.0 million.
While administrative expenses rose to GBP22.2 million from GBP21.3 million, the main cause of the fall in profit was two one-time gains in financial 2021 - including profit on the sale of property - that weren't repeated. Excluding such items from both years, profit was flat at GBP11.3 million from GBP11.1 million.
Character Group declared a 17.0 pence total dividend for financial 2022, up 13% from 15.0p.
The company said it has a strong product offering, including new products under its Stretch Armstrong, Star Wars, Transformers and Teenage Mutant Ninja Turtles ranges.
"The strength of our brands and products portfolio in 2022 has enabled us to significantly increase sales despite intense margin pressure," Character Group said.
However, it warned: "Trading conditions have become more challenging and sales have slowed in the lead-up to Christmas and combined with other factors will adversely affect the group's performance in the first half of the current financial year."
Looking further out, Character Group said it expects international sales to grow "significantly" in the second half of financial 2023, improving margins, while domestic sales are expected to be flat.
By Tom Waite, Alliance News editor
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