Toy and confectionery business Funtastic (FUN) has seemingly gone against the trend in retailing by lifting its profit by 34% for the year to July 31.
The company said it had battled through a weak retail environment in Australia and earned a net profit of $13.96 million, up 33.8% on the $10.44 million earned in 2011-12.
But that result included gain of $3.3 million from the renegotiation of the amount it paid for a license to manufacture and distribute certain Lego stationery products.
Without that, the actual net result would have been little changed from the previous year, and perhaps better reflective of the tough retailing conditions most groups have seen.
The true position of the company’s experience in the year just ended was underlined by a 2.4% dip in sales for the year to $166.55 million.
And, excluding that one-off gain, earnings before interest, tax, depreciation and amortisation (EBITDA) were $20.7 million in the year to July 31, up slightly from $20.2 million in the previous year.
FUN YTD – Funtastic marking time as shares slide
‘‘Given the difficult retail conditions, it is pleasing to report improved earnings, despite some sales declines domestically,’’ chief executive Stewart Downs said.
"Both our domestic businesses, Funtastic Australia and Madman Entertainment, have become solid and reliable contributors and we are excited by our Funtastic brands growth," he said.
The company said recent changes to the business, including its ownership of brands, would make it a more stable and predictable business.
Funtastic said it is confident of delivering a lift in earnings per share in the year ahead as it continues to enjoy growth outside Australia. This includes the expansion in the Slurpee product in some overseas markets.
Funtastic will pay a fully-franked final dividend of 0.5c. That takes the full year payment to one cent a share.
Funtastic shares were up 1c ot 6.9% to 15.5c in yesterday’s very weak market.
