MAKING A PLAY; MALIBU TOY COMPANY SERIOUS ABOUT SUCCESS.Byline: Enrique Rivero Daily News Staff Writer Toys are not a game at Jakks Pacific JAKKS Pacific, Inc. NASDAQ: JAKK is is a multi-brand company that designs and markets a broad range of toys and consumer products and is based in Malibu, California. Its product categories include action figures, art activity kits, stationery, writing instruments, performance Inc. The atmosphere at Jakks' Pacific Coast Highway Pacific Coast Highway may refer to:
It's a no-nonsense, low-key and even modest operation that mirrors where Jakks sees itself within the overall toy market. ``We are the Mattel and Hasbro with less zeros at the end of our revenues,'' said President, Chief Operating Officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. and co-founder Stephen Berman. Still, Jakks has been adding a few zeros to its bottom line of late. First-quarter sales ending March 31 jumped nearly 111 percent to $11 million from $5.2 million in the year-ago period. Net income rose 127 percent to $461,861, or 8 cents per diluted share, from $203,417 (5 cents). For the entire fiscal year 1997, earnings more than doubled to nearly $2.8 million, or 52 cents a share, from about $1.2 million, or 34 cents a share. Sales were $41.9 million, more than triple the $12.1 million generated in 1996. Those extra zeros have also gotten the company noticed by Business Week: Jakks was No. 55 in the magazine's list of top 100 growth companies. Not bad for a company that steers away from toys with blazing, but short-lived, popularity in favor of products with smaller but steady sales, known as evergreens. And not bad for company co-founder Jack Friedman, who started Jakks in 1995 shortly after his ouster ouster n. 1) the wrongful dispossession (putting out) of a rightful owner or tenant of real property, forcing the party pushed out of the premises to bring a lawsuit to regain possession. from THQ THQ Toy Headquarters THQ Territorial Headquarters THQ Tehsil Headquarters (Pakistan) THQ The Holy Quran THQ Theater Headquarters Inc., the Calabasas-based maker of video game software that he founded in the late 1980s. ``This is like a dream come true,'' Friedman said about Jakks. ``When you have a picture in your head and get there with few bumps, it's exciting.'' Darren Barker, a research analyst with Wedbush Morgan Securities in Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. , said he first took note of the company in February while researching a comparable toy company in Long Island, N.Y. Intrigued, he began formally covering the publicly traded company publicly traded company A company whose shares of common stock are held by the public and are available for purchase by investors. The shares of publicly traded firms are bought and sold on the organized exchanges or in the over-the-counter market. , and on May 6 issued a report with a ``buy'' recommendation. The company's reliance on a diverse line of evergreen products as opposed to toys that are hot one minute and gone the next provides sales and earnings stability, Barker said. ``I think that's unique for a company of their size,'' he said. ``If you look at Mattel and Hasbro, they're focused on developing brands like this, and they're strong sellers year in and year out.'' Other strengths are Jakks' ability to effectively integrate the companies it acquires and its conservative operating strategy, whereby it carries minimal inventory and ships products from its Hong Kong Hong Kong (hŏng kŏng), Mandarin Xianggang, special administrative region of China, formerly a British crown colony (2005 est. pop. 6,899,000), land area 422 sq mi (1,092 sq km), adjacent to Guangdong prov. manufacturing facilities directly to customers, which include Toys `R' Us. ``In an industry that is as faddish fad·dish adj. 1. Having the nature of a fad. 2. Given to fads. fad  dish·ly adv. as toys are, you don't
want to get stuck with inventory,'' Barker said.
Friedman, who has 34 years of experience in the toy industry, started Jakks with Berman - also a THQ alumnus ALUMNUS, civil law. A child which one has nursed; a foster child. Dig. 40, 2, 14. - in 1995 with the acquisition of doll maker Justin Products. The company went public in May 1996. Since then, Jakks has grown primarily by acquiring other successful toy businesses. In February 1997, it bought die-cast toy vehicle maker Road Champs for $11.7 million, and eight months later acquired toy truck maker Remco and preschool educational toy company Child Guidance for $13.4 million. The company's biggest single revenue source is its licensed World Wrestling Federation action figures, a line that Friedman said represents 40 percent to 50 percent of Jakks' sales. He expects the company to sell 15 million WWF See Windows Workflow Foundation. figures this year. Friedman admits that his departure from THQ stemmed from his failure to understand high-tech toys. ``Our games started to fare poorly and I was very frustrated, not being a gamer myself and not being familiar with the technology,'' he said of his experience at THQ. His forte is the traditional ``toy-toy,'' and he is in his element at Jakks. ``Jack is a toy guy,'' Barker said. ``The toy industry is different from the video (game) industry.'' So toys are not a game at Jakks, and the company will continue to focus on products that have steady sales. Still, Friedman and Berman would be perfectly happy if a Jakks toy becomes a blazing cultural phenomenon, like the Tickle Me Elmo Tickle Me Elmo is a childrens' toy from Tyco, introduced in the United States in 1996, becoming that year's top fad. Bright red in color and based on Elmo, a Muppet character from Sesame Street, when squeezed, Elmo would chortle. dolls from a couple of years back, or Mattel's ever-popular Barbie. When they talk about this possibility, they can't help veering into game metaphors. ``We're not looking for Looking for In the context of general equities, this describing a buy interest in which a dealer is asked to offer stock, often involving a capital commitment. Antithesis of in touch with. home runs; we're looking for singles and doubles,'' Berman said. ``And if a home run happens, we're happy.'' AT A GLANCE Company name: Jakks Pacific Inc. Address: 22761 Pacific Coast Highway, Suite 226, Malibu, CA 90265 Business: Toy manufacturer and marketer Chairman and chief executive: Jack Friedman President and chief operating officer: Stephen Berman Chief financial officer: Joel Bennett Employees: 55 Stock symbol: JAKK Annual sales: $41.9 million in 1997 Market capitalization Market Capitalization A measure of a public company's size. Market capitalization is the total dollar value of all outstanding shares. It's calculated by multiplying the number of shares times the current market price. This term is often referred to as market cap. : $59 million History: Founded in 1995 by Friedman and Berman with the acquisition of doll maker Justin Products, the company went public in May 1996. Since then, Jakks has purchased die-cast toy vehicle maker Road Champs, toy truck maker Remco and preschool educational toy company Child Guidance. The company focuses on toy lines with steady sales. CAPTION(S): 2 Photos, Box PHOTO (1--Color) Jack Friedman, left, and Stephen Berman, co-founders of Jakks Pacific Inc., display some of their products at their Malibu headquarters. (2--Color) The Steve Austin action figure is a top seller for the company. Evan Yee/Daily News BOX: AT A GLANCE (see text) |
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