Tag Archives: Profit

The LEGO Group’s 2017 Financial Results Are… Disappointing

LEGO-Group-Annual-Report-2017-1

At a press conference today LEGO have shared the details of their 2017 full year financial results and the numbers are far from impressive. In fact Niels B. Christiansen, the LEGO Group CEO labelled 2017 a challenging year and said that he is not satisfied with the results.

The reports contain a lot of information, most of it complex financial details that probably only make sense to accountants. Here are some of the key figures though:

There was a decrease in revenue by 8 percent to DKK 35.0 billion compared with DKK 37.9 billion in 2016. Excluding the impact of foreign currency exchange, revenue for the full year declined 7 percent compared with 2016.

Operating profit (profit before financial items and tax) for 2017 was DKK 10.4 billion compared with DKK 12.4 billion for 2016, a decrease of 17 percent year on year. Net profit for the full year was DKK 7.8 billion compared with DKK 9.4 billion in 2016.

A profit of DKK 7.8 billion is still significant but the story is obviously just how much lower that is than 2016.

LEGO are attributing the lower profits, in part, to a “clean-up of inventories across the value chain.”  I am honestly not sure exactly what that means.

LEGO have also released a document with some interesting facts for the year.

Best selling themes (random order)

  • LEGO® City
  • LEGO® Friends
  • LEGO® Star Wars™
  • LEGO® Creator
  • LEGO® DUPLO®

Best selling sets (random order)

  • LEGO® City Police Station (60141)
  • LEGO® City High Speed Chase (60138)
  • LEGO® Star Wars™ Millennium Falcon (75105)
  • LEGO® Star Wars™ BB-8 (75187)
  • THE LEGO BATMAN MOVIE Minifigure Series (71017)

On the AFOL side of things there are 300 Recognised LEGO User Groups and an estimated 500,000 adult fans of LEGO.

You can read more about the annual results here. The PDF with interesting facts is found here.

Thanks to Trevor who sent me links to the interesting facts.

LEGO Announces 2016 Financial Results

LEGO Annual Report 2016

The LEGO Group last night held a press conference to announce their 2016 financial results and spoiler alert – they made a lot of money.

The two key takeaways are revenue and net profit – both of which increased. Revenue for the full year increased by 6.0 percent in DKK to DKK 37.9 billion compared with DKK 35.8 billion for 2015. Net profit for the full year was DKK 9.4 billion compared with DKK 9.2 billion in 2015. That profit equates to nearly 1.8 billion Australian dollars.

Statements from the new CEO revealed that sales in the US were flat despite a significant increase in marketing spend in the second half of the year. It will be interesting to see if the US continues to underperform in the future and the impact that an import tax from the Mexican factory may have (if it happens).

The LEGO Group’s profit increased even with a continued focus on global growth. DKK 2.9 billion was invested in property and building production capacity, including a new factory in China, and a net additional 1,760 people joined the organisation.

The revenue for 2016 was helped by a great lineup of products with 335 new products introduced. Revenue growth was driven by strong performance from core themes including City, Ninjago, Friends, Technic and Creator.

The report also reveals that LEGO employs an incredible 16,836 employees. This is an average figure for 2016 that factors in staff turnover and temporary positions. According to the full report employee expenses actually outweighed the cost of raw materials and consumables used.

As a LEGO fan it is a good thing that the company is doing so well as it means there is plenty of money to invest in new and innovative products.

For those of you that love reading financial statements you can view a copy of the annual report here.

Via https://www.lego.com/en-us/aboutus/news-room/2017/march/annual-results-2016/