Lego profits soar thanks to 'the force' and some wizardry
Friday 04 March 2011
The force is with Lego, the Danish toymaker which saw profits soar by a galactic 63 per cent last year thanks to a boost from Darth Vader and friends.
The booming popularity of movie-themed box sets including Star Wars, Harry Potter and Indiana Jones pushed Lego's profits up to £563m, on revenues up by 32 per cent to £1.8bn, the company said yesterday. Sales in the UK alone shot up by 48 per cent over the year as a whole, and by 57 per cent over the vital Christmas period.
The company now commands roughly 5.9 per cent of the global toy market, catapulting it to fourth place in the world league, Lego said.
"The result is extremely satisfactory and is due in part to vigorous growth in markets such as the US, UK, Russia and Eastern Europe – all identified as growth markets for the company," the company's chief executive, Jørgen Vig Knudstorp, said.
Lego is seeing a remarkable renaissance, after several difficult years, in which it was pushed into the shadows by the brash charms of computer games. While the toy market as a whole suffered from falling consumer confidence and restricted household spending in 2010, for Lego it was a year of expansion. The company opened a new warehouse in Czech Republic, it is in the process of building a new factory in Mexico, and it has hired more than 1,000 extra people across the world.
At least part of the boost to sales is not coming from children at all. Lego estimates that as much as 10 per cent of its products are sold to adults, and adult Lego fan conventions are springing up all over the world.
Lego makes around 30 billion pieces every year, most of which are the classic multi-coloured bricks for which the company is famous. The biggest commercially available set is a 5,922-piece Taj Mahal, which is approximately half a metre wide and nearly as tall once it is completed.
However, enterprising Lego fans have built all manner of bespoke creations, including a record-breaking 31-metre tower completed at Legoland Günzburg in Germany last August.
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