TORONTO, March 19, 2020
/CNW/ - Spin Master Corp. ("Spin Master" or the "Company")
(TSX: TOY; www.spinmaster.com), a leading global children's
entertainment company, today announced that the Company is
withdrawing its 2020 outlook previously provided on March 4, 2020 in connection with 2020 Gross
Product Sales1 and Adjusted EBITDA
Margin1. Spin Master will not issue further
guidance in the near term due to uncertainty related to the rapidly
developing COVID-19 situation. It is anticipated that the spread of
COVID-19 and global measures to contain it, will have an impact on
the Company, however it is challenging to quantify the
potential magnitude of such impact at this time. The Company is
regularly assessing the situation and remains in contact with its
customers and suppliers to assess any impacts and risks. Given the
dynamic nature of these circumstances, Spin Master will
provide a further update when it reports Q1 2020 results on
May 6, 2020.
The 2020 outlook provided by Spin Master on March 4, 2020 reflected the information available
to the Company at that time. This information included factory
capacity in China, Vietnam and India, labour return rates, tooling
availability, raw material and component availability, the ability
to shift production between various geographies and products and
customer acceptance of modified delivery dates. Since that time
production levels have increased significantly and are approaching
normal levels. However, due to the current market disruptions and
heightened uncertainty caused by the spread of COVID-19 in global
customer markets, the Company is withdrawing such guidance.
"Since early March we have seen a substantial improvement in our
Asian supply chain, particularly in China, as expected. However, the disruption we
are now seeing in key customer markets resulting from the impact of
COVID-19 is significant and we are withdrawing our fiscal 2020
guidance statement as a result thereof," said Mark Segal, Spin Master's Executive Vice
President and Chief Financial Officer. "Our balance sheet
remains strong, with cash on hand and committed credit lines
available, which provides us with significant financial
flexibility. Spin Master is known for its resiliency and
entrepreneurial spirit. We believe in our ability to withstand any
issues and continue to succeed."
1. Non-IFRS financial
measures. Non-IFRS measures do not have any standardized meaning
prescribed by International Financial Reporting Standards ("IFRS")
and are therefore unlikely to be comparable to similar measures
presented by other issuers. Please refer to the section entitled
"Non IFRS Financial Measures" in the Management Discussion and
Analysis within Spin Master's public filings for a discussion of the
definition, components and uses of such non-IFRS measures, as well
as a reconciliation of such non-IFRS measures to IFRS measures
(where a comparable IFRS measure exists).
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About Spin Master
Spin Master (TSX:TOY; www.spinmaster.com) is a leading global
children's entertainment company that creates, designs,
manufactures, licenses and markets a diversified portfolio of
innovative toys, games, products and entertainment properties. Spin
Master is best known for award-winning brands including Zoomer®,
Bakugan®, Erector® by Meccano®, Hatchimals®, Air Hogs® and PAW
Patrol®. Since 2000, Spin Master has received 110 TIA Toy of The
Year (TOTY) nominations with 30 wins across a variety of product
categories, including 13 TOTY nominations for Innovative Toy of the
Year. To date, Spin Master has produced nine television
series, including the relaunched Bakugan: Battle
Planet and current hit PAW Patrol, which is
broadcast in over 160 countries and territories globally.
Spin Master employs over 1,800 people in countries around the world
including Canada, United States, Mexico, France, Italy, United
Kingdom, Russia,
Slovakia, Poland, Germany, Sweden, the
Netherlands, China,
Hong Kong, Japan, Vietnam and Australia.
Forward-Looking Statements
Certain statements, other than statements of historical fact,
contained in this Press Release constitute "forward-looking
information" within the meaning of certain securities laws,
including the Securities Act (Ontario), and are based on expectations,
estimates and projections as of the date on which the statements
are made in this Press Release. The words "plans", "expects",
"forecasts", "anticipates", "intend", "guidance", "outlook",
"potential", "targets" or "believes", or variations of such words
and phrases or statements that certain future conditions, actions,
events or results "will", "may", "could", "would", "should",
"might" or "can", or negative versions thereof, "be taken",
"occur", "continue" or "be achieved", and other similar
expressions, identify statements containing forward-looking
information. Statements of forward-looking information in this
Press Release include, without limitation, statements with respect
to: the Company's intentions to issue guidance and provide an
update in the future; future financial results and performance of
the Company and the underlying assumptions; the Company's balance
sheet and financial position; and the anticipated impact of the
spread of COVID-19, and global measures to contain it, on the
Company.
Forward-looking statements are necessarily based upon
management's perceptions of historical trends, current conditions
and expected future developments, as well as a number of specific
factors and assumptions that, while considered reasonable by
management as of the date on which the statements are made in this
Press Release, are inherently subject to significant business,
economic and competitive uncertainties and contingencies that could
result in the forward-looking statements ultimately being
incorrect. In addition to any factors and assumptions set forth
above in this Press Release, the material factors and assumptions
used to develop the forward-looking information include, but are
not limited to: the expanded use of advanced technology, robotics
and innovation the Company applies to its products will have a
level of success consistent with its past experiences; the Company
will continue to successfully secure broader licenses from third
parties for major entertainment properties consistent with past
practices; the expansion of sales and marketing offices in new
markets will increase the sales of products in that territory; the
Company will be able to successfully identify and integrate
strategic acquisition opportunities; the Company will be able to
maintain its distribution capabilities; the Company will be able to
leverage its global platform to grow sales from acquired brands;
the Company will be able to recognize and capitalize on
opportunities earlier than its competitors; the Company will
be able to continue to build and maintain strong, collaborative
relationships; the Company will maintain its status as a preferred
collaborator; the culture and business structure of the Company
will support its growth; the current business strategies of the
Company will continue to be desirable on an international platform;
the Company will be able to expand its portfolio of owned branded
intellectual property and successfully license it to third parties;
use of advanced technology and robotics in the Company's products
will expand; access of entertainment content on mobile platforms
will expand; fragmentation of the market will continue to create
acquisition opportunities; the Company will be able to maintain its
relationships with its employees, suppliers and retailers; the
Company will continue to attract qualified personnel to support its
development requirements; and the Company's key personnel will
continue to be involved in the Company products and entertainment
properties will be launched as scheduled and that the risk factors
noted in this Press Release, collectively, do not have a material
impact on the Company.
By its nature, forward-looking information is subject to
inherent risks and uncertainties that may be general or specific
and which give rise to the possibility that expectations,
forecasts, predictions, projections or conclusions will not prove
to be accurate, that assumptions may not be correct and that
objectives, strategic goals and priorities will not be achieved.
Known and unknown risk factors, many of which are beyond the
control of the Company, could cause actual results to differ
materially from the forward-looking information in this Press
Release. Such risks and uncertainties include, without limitation,
the magnitude and length of economic disruption as a result of the
worldwide COVID-19 outbreak, and the factors discussed in the
Company's disclosure materials, including the Annual MD&A and
the Company's most recent Annual Information Form, filed with the
securities regulatory authorities in Canada and available under the Company's
profile on SEDAR (www.sedar.com). These risk factors are not
intended to represent a complete list of the factors that could
affect the Company and investors are cautioned to consider these
and other factors, uncertainties and potential events carefully and
not to put undue reliance on forward-looking statements.
There can be no assurance that forward-looking statements will
prove to be accurate, as actual results and future events could
differ materially from those anticipated in such statements.
Forward-looking statements are provided for the purpose of
providing information about management's expectations and plans
relating to the future. The Company disclaims any intention or
obligation to update or revise any forward-looking statements
whether as a result of new information, future events or otherwise,
or to explain any material difference between subsequent actual
events and such forward-looking statements, except to the extent
required by applicable Canadian law.
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SOURCE Spin Master Corp.