The Character Group, a UK-based maker of toys, reported a significant uptick in profit despite turnover remaining steady during the six months to February, according to its half-year statement.
The firm, which makes and sells toys and games in the UK, Scandinavia and the Far East, saw its profit before tax jump to £2.1m from £0.5m in the previous six months
Revenue at the firm in the half-year to March dropped slightly to £57.6m from £57.9m in the previous six months. Underlying earnings per share came in at 8.7p.
Basic earnings per share hit 9.3p, up from a loss of 0.9p in the same period last year.
The toymaker has struggled over the past year with higher costs and flat revenue, which have hit its top and bottom lines.
However, the results suggest it has begun to turn a corner. The group also ended the period with net cash and equivalents of £12.9m.
Management has also expressed confidence in the recovery. Executive director Jonathan Diver recently bought up £117k’s worth of new shares in the company.
The company said in its results: “We have been encouraged by the enthusiasm with which our product portfolio has been received by our customers. The industry buzz around some of our new releases, such as Terror Fried, and new additions to our established lines, like Goo Jit Zu, is very encouraging too.”
Character added: “The group has a strong portfolio of products, underpinned by a strong balance sheet, and has a net cash position with substantial unutilised working capital facilities in place.”
“On the back of our first half-year’s performance and these signs of the group’s robust health, we anticipate profit before tax and highlighted items in respect of the full year to 31 August 2024 will exceed current market expectations. The board is comfortable that the group is on course to meet its targets,” it continued.