The company’s annual results show that the LEGO Group’s revenue, profits and sales all grew in 2018, making this year’s report more positive.
After last year’s financial report showed revenue, growth and profit down, the LEGO Group will be relieved to be able to share better news this year. In 2018, revenue grew by 4% to 36.4 million DKK, which is up on 2017 but still lower than the 2016 figure. Operating profit also grew in 2018 by 4% to 10.8 million DKK.
The growth was due to a 3% increase in consumer sales, with market share increasing in “all major markets”. Given the disappointing results last year in Europe and North America, this will be a relief to the company. The toy industry on the whole has been struggling with declining sales over the past year, in part due to the closure of Toys R Us.
“We set out with one aim in 2018, to stabilise the business. We are pleased to have achieved this, and to have delivered modest top and bottom-line growth,” said LEGO Group CEO, Niels B Christiansen.
“We are especially encouraged by our progress given the challenges facing the toy industry and the departure of specialist retailers such as Toys R Us. These shifts gave us the opportunity to strengthen our partnerships with retailers and find new ways to connect with shoppers and consumers across digital and physical channels. We also grew market share in our largest markets around the world, bucking industry trends.
“We’d like to thank our talented colleagues who did an outstanding job executing plans during the peak holiday season.”
The LEGO Group’s strategy for China seems to be working, where double-digit growth is reported. In established markets, growth was in the “low-single digits”. While the company has not ranked the top selling themes, they include City, Technic, Star Wars, Friends and NINJAGO.
“Last year, we were pleased with the response to our homegrown themes such as LEGO City and LEGO Technic. We were also encouraged by the positive reaction to new products and experiences which integrated digital play, such as the augmented reality app, AR Playgrounds, the DUPLO Cargo Train, which introduces coding to our youngest fans and LEGO BOOST which makes robotics intuitive and fun,” Christiansen added. “We will continue to invest in both our core and in new technology which brings the brick to life in wonderful and unexpected ways.”
During 2019, the company plans to continue its expansion in China with 80 new branded stores in 18 cities, including the recently opened flagship store in Beijing. Following the recent opening of the Dubai office, the LEGO Group will also seek to expand its presence in the Middle East.