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Lego builds a big increase in sales, but profits fall as the price of plastic and other costs rise
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Danish toy giant Lego posted a strong increase in six-monthly sales, but saw profits decline due to rising costs.
It reported that pre-tax profits fell 2 percent to £949 million in the first six months of the year as it faced higher costs for raw materials, energy and freight.
But a 17 percent rise in revenues to £3.2 billion, with consumer sales up 13 percent, offset inflationary pressures, leaving profits stable at the corporate profit level, at £954 million.
Strong demand: but Lego reported profits fell 2% in the first six months of the year to £949 million as it faced higher raw material, energy and freight costs
Lego has raised a number of prices due to its higher cost, with plastic resin used to make its bricks only one area that has become more expensive.
Boss Niels Christiansen said: “We got off to a strong start in 2022 and are very pleased with the performance that has exceeded expectations after an exceptional 2021.”
He expects consumer demand to hold up in the last six months of 2022 and Christmas, with strong sales of his 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, founded by Ole Kirk Kristiansen – its name comes from the Danish words ‘Leg’ and ‘Godt’, meaning ‘play well’.