Lego builds up a big sales rise but profits slump as price of plastic and other costs soar
Danish toy giant Lego has notched up a big rise in half-year sales, but saw profits slip back due to rising costs.
It reported pre-tax profits dropping 2 per cent to £949million in the first six months of the year as it faced higher costs for raw materials, energy and freight.
But a 17 per cent surge in revenue to £3.2billion, with consumer sales up by 13 per cent, offset inflationary pressures keeping earnings stable at operating profit level, at £954million.
Strong demand: But Lego reported profits dropping 2% to £949m in the first six months of the year as it faced higher costs for raw materials, energy and freight
Lego has raised some prices due to its higher costs, with plastic resin used to make its bricks just one area that has become more expensive.
Boss Niels Christiansen said: ‘We got off to a strong start in 2022 and are very satisfied with performance which landed above expectations after an exceptional 2021.’
He expects consumer demand to hold up over the final six months of 2022 and Christmas, with strong sales of its Star Wars, Harry Potter and Technic sets.
It launched 66 stores in the first half and now has 833. It is celebrating its 90th anniversary, having been founded by Ole Kirk Kristiansen – its name comes from the Danish words ‘Leg’ and ‘Godt’, which mean ‘play well’.