Lego profits surge thanks to Asian growth

First-half numbers released by Lego on Wednesday showed that neither Barbie nor Transformers are any match for the classic Danish bricks.

Lego profits surge thanks to Asian growth
Lego's revenue rose by 18 percent. Photo: KAZUHIRO NOGI/Scanpix
The world's largest toy maker Lego on Wednesday reported a jump in first half profit and sales, underpinned by strong growth in Asia.
Revenue increased 23 percent to 14.1 billion kroner (1.89 billion euros, $2.13 billion), putting the Danish group ahead of its US-based rivals Mattel — maker of Barbie — and Hasbro, whose products include the Transformers toy line.
Stripping out the effects of a strong US dollar, revenue rose 18 percent. Net profit grew 31 percent to 3.55 billion kroner, making it more profitable than its two competitors.
The result was “especially encouraging since we compare [it] to 2014 when The Lego Movie products boosted our performance,” chief executive officer Jørgen Vig Knudstorp said in a statement.
The company's first half results were released on the same day that astronaut Andreas Mogensen took a set of custom-made Lego sets with him as he became the first Dane in space.
The Lego City, Technic and Star Wars lines were among the most popular, while new launches such as Jurassic World and the girl-focused Lego Elves “were received very positively,” the company said.
The group will open its first Asian factory, which will initially only package products made elsewhere, in Jiaxing near Shanghai by the end of the year.
“While all our regions experienced double-digit growth during the first half of 2015, it is particularly satisfactory that Asia saw the highest growth rates given the considerable investments we are making there,” chief commercial officer Loren Shuster said.
The colourful bricks are currently produced at the group's headquarters in the Danish town of Billund, and at newer plants in the Czech Republic, Hungary and Mexico.
Lego has outpaced the rest of the toy industry for several years, defying the rising popularity of mobile phones and tablets.
In June, it announced an investment of one billion kroner into research to replace the oil-based plastic in its products.
The privately owned company was founded in 1932 by carpenter Ole Kirk Kristiansen, who in 1934 gave it its current name, an abbreviation of the Danish words “leg godt”, meaning “play well.”
His grandson, former chief executive Kjeld Kirk Kristiansen, is ranked the world's 129th richest man according to Forbes magazine, with an estimated fortune of $9.4 billion.

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Denmark’s toy giant Lego offers staff bonus after bumper year

Danish toymaker Lego, the world's largest toymaker, Denmark's Lego, said on Tuesday it will offer its 20,000 employees three extra days of holiday and a special bonus after a year of bumper revenues.

Lego is rewarding staff with a Christmas bonus and extra holiday after a strong 2022.
Lego is rewarding staff with a Christmas bonus and extra holiday after a strong 2022. File photo: Ida Guldbæk Arentsen/Ritzau Scanpix

Already popular globally, Lego has seen demand for its signature plastic bricks soar during the pandemic alongside its rapid expansion in China.

“The owner family wishes to… thank all colleagues with an extra three days off at the end of 2021,” the company said in a statement.

The unlisted family group reported a net profit of more than 6.3 billion Danish kroner (847 million euros) for the first half of 2021.

Revenues shot up 46 percent to 23 billion kroner in the same period.

It had been “an extraordinary year for the Lego Group and our colleagues have worked incredibly hard,” said the statement, which added that an unspecified special bonus would be paid to staff in April 2022.

Lego, a contraction of the Danish for “play well” (leg godt), was founded in 1932 by Kirk Kristiansen, whose family still controls the group which employs about 20,400 people in 40 countries.

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