Lego A/S has posted a 4 percent year-on-year increase in revenue to 36.4 billion Danish krone ($5.5 billion) in 2018, thanks to strong sales in China.
Termed by Lego as “a strategic growth market” for the company, China reported “strong double-digit” growth in income last year.
In its annual results statement released Feb. 27, the Danish toymaker stated that the brand expanded into new cities and built its presence on ecommerce, digital and physical platforms in China last year.
In 2019, the company aims to accelerate expansion in China and open 80 stores in 18 cities, starting with a new flagship store in Beijing which opened Feb. 22.
Lego's operating profit rose 4 percent year-over-year to 10.8 billion krone ($1.6 billion), helped by increased sales and “balanced with a continued focus on investing for the future,” Lego stated.
Cash flow from operating activities fell 8 percent to 9.8 billion krone ($1.5 billion).
“We set out with one aim in 2018, to stabilize the business. We are pleased to have achieved this, and to have delivered modest top and bottom-line growth,” CEO, Niels B Christiansen said.
Christiansen was “especially encouraged” by the company's progress given the challenges facing the toy industry and the departure of specialist retailers such as Toys R Us.
“These shifts gave us the opportunity to strengthen our partnerships with retailers and find new ways to connect with shoppers and consumers across digital and physical channels,” the Lego CEO added.
The group also said that it “bucked toy industry trends” in 2018 to grow its share in all major markets globally.
