- Spin Master Corp. reported robust growth in its revenue and product sales report for Q4 and full-year 2023
- The global children’s entertainment company said its Q4 revenue was US$502.6 million, up 7.9 per cent from US$465.8 million
- Revenue for the year was US$1.9049 billion, a decrease of 5.7 per cent from US$2.0203 billion in 2022
- Spin Master Corp. opened trading at C$33.88 per share
Spin Master Corp. (TSX:TOY) reported robust growth in its revenue and product sales report for Q4 and full-year 2023.
Spin Master Q4 and 2023 highlights
The global children’s entertainment company said its Q4 revenue was US$502.6 million, up 7.9 per cent from US$465.8 million, because of increases in entertainment, toy and digital games revenue of 76.9 per cent, 2.5 per cent and 7.1 per cent respectively. Constant currency revenue was US$493.9 million, an increase of 6.0 per cent from US$465.8 million in Q3 2022.
Toy revenue in the quarter increased by US$10.1 million or 2.5 per cent to US$406.8 million driven by an increase in toy gross product sales.
Entertainment revenue was US$55.2 million, an increase of US$24.0 million or 76.9 per cent from higher distribution revenue associated with new content deliveries including “Unicorn Academy,” “Rubble & Crew” and “Vida the Vet” and from ongoing distribution revenue from “PAW Patrol: The Mighty Movie.” Constant currency entertainment revenue increased by US$24.1 million or 77.2 per cent to US$55.3 million, from US$31.2 million.
Digital games revenue in Q4 was US$40.6 million, an increase of US$2.7 million or 7.1 per cent from US$37.9 million, because of higher in-game purchases in “Toca Life World” and higher subscription revenue from the Piknik bundle and “PAW Patrol Academy.”
Revenue for the year was US$1.9049 billion, a decrease of 5.7 per cent from US$2.0203 billion in 2022. The company said this was driven by a decline in toy revenue, partially offset by an increase in entertainment and digital games revenue.
Toy gross product sales declined by 9.7 per cent for the year compared to 2022.
Revenue, excluding “PAW Patrol: The Mighty Movie” distribution revenue of US$15.6 million, declined by 6.5 per cent for the year compared to 2022.
Spin Master outlook
The company continues to expect 2023 adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) margin (excluding “PAW Patrol: The Mighty Movie” distribution revenue of $15.6 million) to be up, compared to 2022 adjusted EBITDA margin, which is consistent with Q3 2023 guidance.
Spin Master leadership’s take
“We are very pleased with how our team navigated the challenging macroeconomic environment to deliver revenue growth in the fourth quarter,” Spin Master’s global president and CEO, Max Rangel, said in a news release. “We harnessed the strength of our three creative centres to meet our full-year revenue expectations. While our toy revenue declined for the full year compared to 2022, our POS remained ahead of the industry and we grew market share globally, by introducing innovation into the toy aisle, engaging fans of popular franchises both licensed and owned, and growing our evergreen brands to create magical play experiences for millions of children globally. We saw strong increases in entertainment from the PAW Patrol movie and the delivery of the Unicorn Academy series, and we grew digital games revenue, highlighting the power of our diversified portfolio to drive long-term growth.”
According to Zacks, Spin Master Corp. holds an average “Strong Buy” recommendation from eight analysts.
Spin Master Corp. is a children’s entertainment company creating exceptional play experiences through its three create centres; toys, entertainment and digital games. Its top brands include Paw Patrol, Bakugan along with Melissa and Doug.
Spin Master Corp. opened trading down nearly 1 per cent at C$33.88 per share.
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