JAKKS Pacific, Inc. (NASDAQ:JAKK) Q3 2023 Earnings Call Transcript

And we believe we’ll get much stronger and even bigger than we were with our original platform in Seasonal in the next couple of years. We have worked on this. We finished the deal over the last few days. We’re both excited. We’re on the road with retailers already. We’re in complete development in Asia. Our team has been there. They’re back there again this week. So we just don’t know how quick it will get to the market, but we do think it will be somewhat material to us in the segment of which we’re in. And ELEMIS was one of the largest brands worldwide for skateboards. And so we have that whole category skateboards with Quicksilver. We have a beautiful line of roller blades and rollerskates with the [indiscernible] brand. We have a broad array of seasonal outdoor products for beach and parks for like football games, soccer games for family and children that aligns with our kids outdoor furniture that just parlays bringing it from kids to teens, tweens and adults.

So, we’re really just more diversified into a kids consumer product company and a consumer product company for families. And we’re extremely excited about it. ABG is excited about it and the retailers are excited about it.

Andrew Uerkwitz: That’s super helpful. And then kind of just last question. Looking at the international opportunity. I think you made some real inroads it looks like this year and on a two-year stack in Latin America. You are down, I think, year-over-year, year-to-date in Europe. How should we think about the impact of the efforts there? Is it to help with margins? Is it eventually — will we see growth in international? What’s kind of the — what’s the goal with the European expansion right now because it doesn’t seem to be showing up in the income statement quite yet?

Stephen Berman: So, this year, as you’ve seen in our industry, I’d say we’ve been — I think we were flat. And this year, the call it, the toy companies have had down years overall. That being said, we wouldn’t be moving Jack McGrath and a team of people for the US to the international territories, allowing the team to make immediate decisions and not having to come to the, call it, corporate office. Jack has worked with me for over 25 years. He’s got my completing the company’s support and the Board’s support. The — we just opened up — I just got back a week ago from [indiscernible] Italy, where our new distribution center and offices are at, our new offices in France. We will see growth, I would say, hands down just by having him in there, but not just that, we also have a broad array of products that are new and that are consistent.

We have a whole line of the princess style collection. That’s a mature line and growing in North America, but it’s only been in Europe for about two years. It took us five years to get that growth. We have the Simpsons. We have aesthetic brands. We have the new movie, which we have a fluster of different areas of business from the boys action. So, we will see growth. I’m very confident and adamant about it. And we should see enhanced margins because the operational side of things, Jack is very involved with. So we will see growth and I think operational enhancement globally starting probably the first half of next year in the second half.

Andrew Uerkwitz: Got it. That’s very helpful. I think I do have one more question kind of on Q4. Listening to some of your competitors have reported so far, both kind of mentioned that they view kind of Q4 holiday spending, returning back to normal and I think that what they really mean is that the spending will mostly happen in end of November, December. Just curious what your thoughts are on where the consumer is at from a spending pattern perspective, this particular holiday.