For the Financial Times, Lego bricks are the winners of the pandemic. This is confirmed by the record sales and profits of the Danish group, one of the largest toy manufacturers in the world. The company, which is not listed on the stock exchange, in the first six months of 2021 more than doubled (+ 140%) its net profit exceeding 6.3 billion Danish kroner about 847 million euros while turnover jumped 46% to 23 billion crowns, about 3 billion euros. The reasons for this success are different and are linked on the one hand to the increase in demand and on the other to the easing of restrictions linked to the pandemic.
The numbers out of the ordinary emerge with greater force if we look at the entire toy sector. If, as in the case of Lego, revenues were only 50% higher than the industry’s number two, Hasbro’s Transformers and My Little Pony, Lego’s net profit was 10 times higher. Our performance was driven by strong demand for our range, Group CEO Niels B. Christiansen said in the financial report. Among the best-selling products are the Lego City, Star Wars, Harry Potter, Lego Creator Expert and Lego Technic kits. For the CEO, one of the reasons for the exceptional growth was the easing of Covid restrictions compared to 2020, with factories operating without interruption, and most of the retail stores that have reopened. Between lockdowns and closed kindergartens, it is also possible that many families discovered Legos in 2020 and then confirmed themselves as customers in 2021.
In any case, the leap of Lego is exceptional, especially when you consider that the group risked financial collapse in 2003.
and boasting a relatively standard business based on popular colored plastic bricks rather than hundreds of products as is the case with listed competitors Hasbro and Mattel. The company was then rewarded with the decision to bet on its own brand physical stores. The company opened a hundred of them during the pandemic, while also increasing investments in sustainability to have recycled plastic bricks.