Signal as much as myFT Every day Digest to be the primary to find out about Lego information.
Lego loved dizzying progress in each gross sales and income within the first half of this 12 months because the Danish toymaker proved itself to be one of many winners of the Covid-19 pandemic.
It cemented its place because the world’s largest toymaker by growing revenues within the first half by 43 per cent 12 months on 12 months to DKr23bn ($3.6bn) and internet revenue by 140 per cent to DKr6.3bn, each information.
Although its revenues had been solely 50 per cent greater than the trade’s quantity two — Transformers and My Little Pony maker Hasbro — Lego’s internet revenue was 10 occasions larger.
Niels Christiansen, Lego’s chief government, credited large investments in its merchandise, model, and retail shops reasonably than Covid-19 pandemic spending for the surge in progress.
“Don’t count on 50 per cent progress 12 months on 12 months on 12 months. However we really suppose that is actual progress, and that is extra a newfound stage that we are able to develop extra from,” he instructed the Monetary Instances.
Lego has recovered from close to monetary collapse in 2003 to turn out to be the strongest firm within the toy trade by far, regardless of the whole lot centring round one concept — the plastic brick — reasonably than the a whole bunch of merchandise that make up the catalogues of listed rivals Hasbro and Mattel. It loved its strongest growth in 5 years in 2020.
Christiansen, who took over after a small blip in its progress in 2017, has invested closely in product strains resembling Monkie Child, the corporate’s first to be based mostly on Chinese language tradition, and Lego units that blur the road between bodily and digital. He has additionally put a counter-intuitive wager on own-brand outlets, opening a whole bunch all through the pandemic.
It not too long ago opened a brand new flagship retailer in New York that goals not simply to promote Lego units resembling Tremendous Mario, Metropolis, or Harry Potter but additionally create an expertise for purchasers with large-scale fashions of town and interactive experiences.
Christiansen mentioned Lego was trying to make use of its sturdy place to speed up its investments even additional in areas from doubtlessly extra shops to making an attempt to spice up its quest to make all Lego bricks sustainable. It had a big breakthrough in June when it introduced it might make its iconic bricks from recycled drink bottles, presumably within the subsequent 18-24 months. “We’ll principally be in search of areas throughout the board the place we are able to speed up,” he added.
The chief government mentioned he didn’t think about a single six-month interval however was happy that in his 4 years in cost Lego had grown at twice the tempo of the broader toy market, and now had merchandise for all age teams and pursuits.
Requested if he was involved that the corporate might stumble once more because it had in 2017 after a decade of success, he replied: “It’s a good query. I’m all the time paranoid, I’m all the time fearful — it’s my nature. However I’m comforted as we’re pushing issues that work. We didn’t do that to get half 12 months; we did it to get on a sustainable journey. May there be half-years sooner or later the place we might be down? I believe so.”
Lego is privately owned by its founding Kristiansen household and their basis, and Christiansen credited them with eager to “put money into the long-term progress of the corporate”. He additionally underscored how Lego’s provide chain coped not simply with the pandemic but additionally the excessive progress because of manufacturing in Europe, Asia, and North America.