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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
July 25, 2007 (July 25, 2007)
JAKKS PACIFIC, INC.
(Exact Name of registrant as specified in its charter)
Delaware 0-28104 95-4527222
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
22619 Pacific Coast Highway 90265
Malibu, California (Zip Code)
(Address of principal
executive offices)
Registrant's telephone number, including area code: (310) 456-7799
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
JAKKS PACIFIC, INC.
INDEX TO FORM 8-K
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
July 25, 2007
ITEMS IN FORM 8-K
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Page
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Facing Page 1
Item 2.02 Results of Operations and Financial Condition 3
Item 9.01 Financial Statements and Exhibits 3
Signatures 4
Exhibit Index 5
Item 2.02. Results of Operations and Financial Condition.
On July 25, 2007, we issued a press release announcing our results of
operations for the quarter ended June 30, 2007. A copy of such release is
annexed hereto as an exhibit.
Item 9.01. Financial Statements and Exhibits.
(c) Exhibits
Exhibit
Number Description
- ------ -----------
99.1* July 25, 2007 Press Release
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* Filed herewith
3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: July 25, 2007 JAKKS PACIFIC, INC.
By: /s/ Jack Friedman
--------------------------
Jack Friedman
Chairman and Chief Executive Officer
4
Exhibit Index
Exhibit
Number Description
- ------ -----------
99.1* July 25, 2007 Press Release
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* Filed herewith
5
Exhibit 99.1
JAKKS Pacific Reports 2007 Second Quarter and First Six Month Results
--- Company Reiterates Full Year Guidance of $800 Million in Net
Sales and Net Income of $75.8 Million, or $2.39 Per Diluted Share ---
MALIBU, Calif.--(BUSINESS WIRE)--July 25, 2007--JAKKS Pacific,
Inc. (NASDAQ:JAKK), a leading toy and consumer products company, today
announced results for the second quarter and six months ended June 30,
2007.
Second quarter 2007 net sales were $129.5 million, compared to
$124.0 million recorded in the comparable period last year. Net income
for the second quarter was $5.0 million, or $0.17 per diluted share,
compared to $6.4 million, or $0.22 per diluted share, reported in the
second quarter of 2006.
The Company's net sales for the six months ended June 30, 2007
were $253.6 million, compared to $231.3 million during the same period
in 2006. Net income for the first six months of 2007 was $8.3 million,
or $0.30 per diluted share, compared to the first six months 2006
earnings of $8.7 million, or $0.31 per diluted share.
"We have excellent placement of our key items at major retailers
as we head into the important holiday season," said Jack Friedman,
Chairman and Chief Executive Officer, JAKKS Pacific. "With an exciting
roster of new products hitting retail late summer and early fall, we
are very comfortable with our previously issued full-year guidance of
$800 million in net sales and net income of $75.8 million, or $2.39
per diluted share."
Stephen Berman, President and Chief Operating Officer, stated,
"Several of our product lines exceeded our expectations in the second
quarter, with the largest contributions coming from our action
figures, dress-up and role play toys. And, as expected, while we began
shipping our sales drivers for Fall at the end of the second quarter,
the bulk of our new products began shipping early in the third
quarter.
"Our investments in product development, strategic marketing
programs and our overall portfolio of innovative products, many based
on popular and classic licenses, have us well-positioned to achieve
record sales in the second half of 2007. We expect strong performances
from many of our product lines, including WWE(R) and Pokemon(R) action
figures, a full array of dolls, playsets, electronics and role play
accessories for the two top Disney sensations Hannah Montana(TM) and
The Cheetah Girls(TM), new TV Games, as well as our Plug It In & Play
EyeClops Bionic Eye(TM), our new line of XPV Xtreme Performance
Vehicles(R) toys, Puppy in My Pocket(R) and more."
Mr. Friedman concluded, "We will continue to seek to grow our
business by actively pursuing additional character and product
licenses, as well as complementary acquisitions that offer valuable
product lines, trademarks or brands. Our financial position remains
very strong and, as of June 30, 2007, our working capital was
approximately $292.1 million, including cash and equivalents of $180.9
million."
JAKKS Pacific is hosting a teleconference at 10:30 a.m. ET (7:30
a.m. PT) on June 25th, via the Internet at www.jakkspacific.com,
www.CompanyBoardroom.com, or www.StreetEvents.com. These websites will
host an archive of the teleconference for 30 days. A telephone
playback will be available from 11:45 a.m. Eastern on July 25th
through 11:59 p.m. Eastern on August 24th. The playback can be
accessed by calling 800-642-1687 or 706-645-9291 for international
callers, passcode "1256686".
About JAKKS Pacific, Inc.
JAKKS Pacific, Inc. (NASDAQ:JAKK) is a multi-brand company that
designs and markets a broad range of toys and consumer products. The
product categories include: Action Figures, Art Activity Kits,
Stationery, Writing Instruments, Performance Kites, Water Toys, Sports
Activity Toys, Vehicles, Infant/Pre-School, Plush, Construction Toys,
Electronics, Dolls, Dress-Up, Role Play, and Pet Toys and Accessories.
The products are sold under various brand names including JAKKS
Pacific(R), Play Along(R), Flying Colors(R), Creative Designs
International(TM), Road Champs(R), Child Guidance(R), Pentech(R),
Trendmasters(R), Toymax(R), Funnoodle(R), Go Fly A Kite(R), Color
Workshop(R), JPI(TM) and Plug It In & Play TV Games(TM). JAKKS and THQ
Inc. participate in a joint venture that has worldwide rights to
publish and market World Wrestling Entertainment video games. For
further information, visit www.jakkspacific.com.
This press release may contain forward-looking statements (within
the meaning of the Private Securities Litigation Reform Act of 1995)
that are based on current expectations, estimates and projections
about JAKKS Pacific's business based partly on assumptions made by its
management. These statements are not guarantees of future performance
and involve risks, uncertainties and assumptions that are difficult to
predict. Therefore, actual outcomes and results may differ materially
from what is expressed or forecasted in such statements due to
numerous factors, including, but not limited to, those described
above, changes in demand for JAKKS' products, product mix, the timing
of customer orders and deliveries, the impact of competitive products
and pricing, and difficulties with integrating acquired businesses.
The forward-looking statements contained herein speak only as of the
date on which they are made, and JAKKS undertakes no obligation to
update any of them to reflect events or circumstances after the date
of this release.
(C) JAKKS Pacific, Inc. All Right Reserved.
JAKKS Pacific, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
June 30, December 31,
2007 2006
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(In thousands)
ASSETS
Current assets:
Cash and cash equivalents $ 180,887 $ 184,489
Marketable securities 213 210
Accounts receivable, net 89,768 153,116
Inventory, net 78,576 76,788
Deferred income taxes 8,866 10,592
Prepaid expenses and other current
assets 24,386 26,543
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Total current assets 382,696 451,738
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Property and equipment 50,195 49,781
Less accumulated depreciation and
amortization 32,807 32,898
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Property and equipment, net 17,388 16,883
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Deferred income taxes 1,471 -
Goodwill, net 340,007 337,999
Trademarks & other assets, net 53,044 60,401
Investment in video game joint venture 17,111 14,873
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Total assets $ 811,717 $ 881,894
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 72,834 $ 120,238
Reserve for sales returns and allowances 17,276 32,589
Income taxes payable 514 18,548
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Total current liabilities 90,624 171,375
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Long term debt 98,000 98,000
Other liabilities 5,815 854
Income taxes payable 8,092 -
Deferred income taxes 2,244 2,377
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114,151 101,231
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Total liabilities 204,775 272,606
Stockholders' equity:
Common stock, $.001 par value 28 28
Additional paid-in capital 305,649 300,255
Retained earnings 304,702 312,432
Accumulated other comprehensive income
(loss) (3,437) (3,427)
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606,942 609,288
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Total liabilities and stockholders'
equity $ 811,717 $ 881,894
============= ============
JAKKS Pacific, Inc. and Subsidiaries
Second Quarter Earnings Announcement, 2007
Condensed Statements of Income (Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2007 2006 2007 2006
--------- --------- --------- ---------
(In thousands, expect per share data)
Net sales $129,547 $124,041 $253,609 $231,286
Less cost of sales
Cost of goods 69,128 61,872 133,498 114,080
Royalty expense 13,130 11,469 25,457 21,084
Amortization of tools and
molds 1,994 1,420 3,851 2,679
--------- --------- --------- ---------
Cost of sales 84,252 74,761 162,806 137,843
--------- --------- --------- ---------
Gross profit 45,295 49,280 90,803 93,443
Direct selling expenses 8,997 11,893 20,824 26,223
Selling, general and
administrative expenses 25,820 24,236 52,223 47,300
Depreciation and amortization 3,990 4,188 7,944 8,712
--------- --------- --------- ---------
Income from operations 6,488 8,963 9,812 11,208
Other income (expense):
Profit (loss) from video
game joint venture 714 220 2,209 977
Interest income 1,793 1,085 3,307 2,500
Interest expense (1,592) (1,133) (3,163) (2,266)
Other expense - - - -
--------- --------- --------- ---------
Income before provision for
income taxes 7,403 9,135 12,165 12,419
Provision for income taxes 2,369 2,774 3,893 3,727
--------- --------- --------- ---------
Net income $ 5,034 $ 6,361 $ 8,272 $ 8,692
========= ========= ========= =========
Earnings per share - diluted $ 0.17 $ 0.22 $ 0.30 $ 0.31
Shares used in earnings per
share - diluted 33,133 32,790 33,019 32,752
CONTACT: JAKKS Pacific, Inc.
Genna Rosenberg, 310-455-6235
or
Integrated Corporate Relations
John Mills, 310-954-1100