Good times for the building block manufacturer: Lego more than doubled its profit in the first half of 2021. Three bestsellers also contributed to this.
Lego marches with a broad chest and loyal customers into the time after the coronavirus pandemic. Thanks in part to strong demand and fewer corona restrictions, the building block manufacturer more than doubled its profit in the first half of 2021.
For the first six months of the year, an operating profit of 8.0 billion Danish kroner (just under 1.1 billion euros) was posted – that was an increase of 104 percent compared to the same period of the previous year, as the Lego group announced on Tuesday. The bottom line was that there was a net profit of 6.3 billion crowns (around 850 million euros), which was an increase of 140 percent. Sales grew by 46 percent to around 23 billion crowns (3.1 billion euros).
“We are very satisfied with the progress that we have made in all business areas during the first half of the year,” said Lego boss Niels B. Christiansen. There was strong demand for Lego products, and the business also benefited from the fact that there were fewer corona restrictions compared to the previous year. The factories could have worked so continuously that the majority of the Lego stores could have reopened.
Investing in online trading
The years of investment in online trading also paid off, as Christiansen emphasized. The sales figures in e-commerce have increased by more than 50 percent compared to the same period of the previous year. At the same time, in addition to the digital Lego market, the number of physical branches is also growing: more than 60 Lego stores were opened in the six months, including over 40 in the growth market of China. This means that Lego was represented in 737 shops in the world’s pedestrian zones in the first half of the year, 291 of them in China.
Once again, the best sellers were product series such as Lego City, Lego Star Wars, Lego Harry Potter, Lego Creator Expert and Lego Technic – some of them not primarily among children and young people, but among adults. With more and more new products, you have been able to win more Lego customers, said Christiansen.
Already in the Corona year 2020, the numbers at Lego showed upwards despite the pandemic and the associated shop closings and partly interrupted supply chains. At that time, the annual turnover climbed by 13 percent to 43.6 billion crowns (5.9 billion euros). As CFO Jesper Andersen emphasized, the Lego Group’s growth in consumer business in the first half of 2021 exceeded that of the toy industry overall.
For some time now, Lego’s investments have been primarily about digitization and sustainability. In June, the group presented the prototype of a building block made from recycled plastic. In addition, the group plans to gradually replace the plastic packaging in the Lego sets with paper bags from the beginning of next year. All packaging should be sustainable by 2025.
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
