Character blames Zhu Zhu Pets for profit fall

Character Group, the maker of Peppa Pig toys, has blamed unloved Zhu Zhu hamsters for a sharp fall in annual profits, as it warned of a "disappointing" Christmas.

The toy maker, which issued a profit warning last month, said weak sales of Zhu Zhu Pets and Squinkies had forced retailers to delay orders and discount to clear stock, hitting the group's margins. Sales of its App Gear toys, which can be used to play games on smartphones, also disappointed. The chairman, Richard King, said: "While international sales have held up well, UK sales proved much more difficult."

Its profits tumbled by 22 per cent to £7.08m in the year to 31 August. But its Peppa Pig, Fireman Sam and Scooby Doo toys "performed well".

Character said: "The trading period to Christmas will not produce a satisfactory result."