By Shares of children’s entertainment company Spin Master climbed after it reported better-than-expected earnings for the latest quarter and maintained its guidance for the year. The stock saw a 3.8% increase in morning trading, reaching C$36.25 per share. This brings the year-to-date gains to 8.8%.
Spin Master upheld its financial guidance for the year, despite a decrease in second-quarter net income. Net income fell to $28 million, or 26 cents per share, compared to $88.1 million, or 83 cents per share, in the same period last year. Adjusted earnings before interest, taxes, depreciation, and amortization declined to $88.4 million from $113.7 million in the previous year, but surpassed analysts’ mean estimate of $73.8 million.
The company reported a 17% decrease in revenue for the quarter, totaling $420.7 million. However, this surpassed analysts’ expectations of $432.6 million. Revenue from Spin Master’s toy segment experienced a 21% decline to $346.3 million due to lower order volume and decreased retail inventory levels. Conversely, entertainment revenue saw a 19% increase to $33.9 million, attributed to new content releases and higher revenue share from the ongoing distribution of “Paw Patrol: The Movie.”
Spin Master maintains its outlook for flat to slightly down gross toy sales in 2023, and expects revenue for the year to be in line with last year, excluding distribution revenue from the Paw Patrol movie.
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