- Jakks Pacific (NASDAQ:NASDAQ:JAKK) reports net sales fell 10.2% in Q3 due to the suspension of shipments to a major U.S. customer, the negative impact of the Brexit vote, a timing lag in international sales caused by shifting to direct-to-retail distribution, and lower-than-expected sales of some movie-licensed products.
- Gross margin rate improved 40 bps to 31.4%.
- SG&A expense rate grew 110 bps to 11.3%.
- Operating margin rate declined 180 bps to 11.4% due to the sales decline and the deleveraging of fixed costs.
- Adjusted EBITDA decreased 18.5% to $42.79M
- Inventory -8% Y/Y to $75.06M.
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FY2016 Guidance: Net sales: ~$755M (~+1%); Gross margin rate: 31.8%; Diluted EPS: ~$0.56 (~+10%); Adjusted EBITDA: ~$53M (~+4%).