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Jakks Pacific Inc (JAKK) SEC Filing 10-Q Quarterly report for the period ending Wednesday, September 30, 2020

Jakks Pacific Inc

CIK: 1009829 Ticker: JAKK
Exhibit 99.1

JAKKS Pacific Reports Third Quarter 2020 Financial Results

Substantial Progress on Improving Profitability

SANTA MONICA, Calif.--(BUSINESS WIRE)--November 2, 2020--JAKKS Pacific, Inc. (NASDAQ: JAKK) today reported financial results for the third quarter ended September 30, 2020.

Highlights

  • Third quarter 2020 net sales were $242.3 million compared to $280.1 million last year
    • Excluding declines in Frozen and Disguise Halloween costumes, Q3 net sales were up 13% year-over-year
    • Retail POS at top three accounts up 28% year-to-date
  • Gross margin of 30.8%, up from 28.9%, an improvement of 190 basis points year-over-year driven by disciplined cost control and improved inventory
    • JAKKS’ inventories down 16% year-over-year, both at top three retailers and on JAKKS’ balance sheet
  • Strong liquidity of $112 million with unrestricted cash of $75 million and revolver availability of $37 million
  • Third quarter 2020 net income attributable to common stockholders of $32.1 million
  • Year-to-date Adjusted EBITDA of $24.3 million up 56% vs. $15.6 million in 2019
  • Subsequent to the quarter-end, the Company reached an agreement with term loan holders that provided covenant relief through March 2022 and a related $15 million early pay-down that will save $1.6 million in annual interest expense

Management Commentary

“Our third quarter results exceeded our expectations for sales, gross margin, operating income and adjusted EBITDA,” said Stephen Berman, JAKKS Pacific’s Chairman and CEO. “We faced significant challenges in the quarter, including difficult comparisons against the successful launch of Disney Frozen 2 last year and reduced retailer commitments to Halloween products. Excluding declines in Disney Frozen® merchandise and Disguise Halloween costumes, our net sales rose thirteen percent compared to the third quarter of last year. Our disciplined cost controls and improved inventory management resulted in higher gross margins, lower SG&A expenses and higher operating income. Retail sales of our products continued to accelerate during the quarter. Our top three US customers in aggregate reported an increase in year-to-date sell-through of 28% through the first nine months, compared to an increase of 14% through the first half.

“We expect the balance of this year to show continued progress on profitability despite difficult revenue comparisons, and to end the year poised for growth in sales and profitability in 2021. We expect to close out the year on a strong note, and carry momentum into 2021. We remain committed to containing costs and managing our balance sheet prudently. We expect good performances over the holiday season from new introductions from Disney Princess®, Disney Frozen®, Electronic Arts® APEX Legends™, SEGA® Sonic the Hedgehog™ and Nintendo® Super Mario™. In addition, we’re continuing to see strong support from our internal brands and products like Kitten Catfe™, Xtreme Power Dump Truck™, ReDo™ Skateboard Co. and our re-launch of Eyeclops™.

“Looking ahead to next year, we believe sales will be buoyed by a more robust entertainment slate by our licensing partners compared to 2020, and what we hope will be a return to more normal consumer shopping patterns and gift giving, as well as a return to more normal Halloween activities. We believe our continued emphasis on margin improvement and cash preservation will lead to improved results in 2021.”


The following information was filed by Jakks Pacific Inc (JAKK) on Monday, November 2, 2020 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Jakks Pacific Inc's 10-Q Quarterly Report:

Financial Statements, Disclosures and Schedules

Inside this 10-Q Quarterly Report

Document And Entity Information
Condensed Consolidated Balance Sheets
Condensed Consolidated Balance Sheets (Parentheticals)
Condensed Consolidated Statements Of Cash Flows
Condensed Consolidated Statements Of Operations And Comprehensive Income (Loss)
Condensed Consolidated Statements Of Stockholders' Equity
Basis Of Presentation
Basis Of Presentation (Details)
Business Segments, Geographic Data, And Sales By Major Customers
Business Segments, Geographic Data, And Sales By Major Customers (Details)
Business Segments, Geographic Data, And Sales By Major Customers (Details) - Schedule Of Revenue By Major Customers By Reporting Segments
Business Segments, Geographic Data, And Sales By Major Customers (Details) - Schedule Of Revenue From External Customers And Long-Lived Assets, By Geographical Areas
Business Segments, Geographic Data, And Sales By Major Customers (Details) - Schedule Of Segment Reporting Information, By Segment
Business Segments, Geographic Data, And Sales By Major Customers (Tables)
Cash Flow, Supplemental Disclosures
Cash Flow, Supplemental Disclosures (Details)
Common Stock And Preferred Stock
Common Stock And Preferred Stock (Details)
Common Stock And Preferred Stock (Details) - Schedule Of Series A Preferred Stock
Common Stock And Preferred Stock (Tables)
Comprehensive Income (Loss)
Comprehensive Income (Loss) (Details) - Comprehensive Income (Loss)
Comprehensive Income (Loss) (Tables)
Credit Facilities
Credit Facilities (Details)
Debt
Debt (Details)
Debt (Details) - Convertible Debt
Debt (Details) - Convertible Debt (Parentheticals)
Debt (Details) - Schedule Of Debt
Debt (Tables)
Fair Value Measurements
Fair Value Measurements (Details) - Fair Value, Liabilities Measured On Recurring Basis, Unobservable Input Reconciliation
Fair Value Measurements (Details) - Fair Value, Liabilities Measured On Recurring Basis, Unobservable Input Reconciliation (Parentheticals)
Fair Value Measurements (Details) - Schedule Of Fair Value, Assets And Liabilities Measured On Recurring Basis
Fair Value Measurements (Tables)
Goodwill
Goodwill (Details)
Income (Loss) Per Share
Income (Loss) Per Share (Details)
Income (Loss) Per Share (Details) - Schedule Of Earnings Per Share, Basic And Diluted
Income (Loss) Per Share (Tables)
Income Taxes
Income Taxes (Details)
Intangible Assets Other Than Goodwill
Intangible Assets Other Than Goodwill (Details) - Schedule Of Intangible Assets And Goodwill
Intangible Assets Other Than Goodwill (Tables)
Inventory
Inventory (Details) - Schedule Of Inventory, Current
Inventory (Tables)
Joint Ventures
Joint Ventures (Details)
Litigation And Contingencies
Related Party Transactions
Related Party Transactions (Details)
Revenue Recognition And Reserve For Sales Returns And Allowances
Revenue Recognition And Reserve For Sales Returns And Allowances (Details)
Share-Based Payments
Share-Based Payments (Details)
Share-Based Payments (Details) - Nonvested Restricted Stock Shares Activity
Share-Based Payments (Details) - Schedule Of Nonvested Restricted Stock Units Activity
Share-Based Payments (Details) - Share-Based Payment Arrangement, Expensed And Capitalized, Amount
Share-Based Payments (Tables)
Subsequent Events
Subsequent Events (Details)

Material Contracts, Statements, Certifications & more

Jakks Pacific Inc provided additional information to their SEC Filing as exhibits

Ticker: JAKK
CIK: 1009829
Form Type: 10-Q Quarterly Report
Accession Number: 0001185185-20-001571
Submitted to the SEC: Fri Nov 13 2020 3:15:08 PM EST
Accepted by the SEC: Fri Nov 13 2020
Period: Wednesday, September 30, 2020
Industry: Games Toys And Childrens Vehicles No Dolls And Bicycles

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