Topps, the US maker of Bazooka gum, posted an increase in quarterly profit yesterday (1 May) despite a decline in the profitability of its confectionery business.
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Topps, which is being bought by an investment firm headed by former Walt Disney boss Michael Eisner, booked fourth-quarter net income of US$2.3m, up from a net loss of $833,000, a year ago. The company said its results were boosted by strong sales from its sports cards business and the absence of a restructuring charge that hurt earnings in the forth quarter of last year.
Arthur T. Shorin, chairman and CEO of Topps, commented: “This represents our fourth consecutive quarter of improved performance. Confectionery, however, remains more of a challenge, experiencing margin pressure and continued weakness in some of our core products.”
In its confectionery segment, net sales rose 8.7% to $33.2m. Topps attributed this rise to the one-time sale of inventory to a new Canadian distributor and the initial sell-in of Vertigo in the US.
Worldwide expansion of Juicy Drop Pops and increased sales of Mega Mouth Spray in Europe offset US declines, the company said.
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By GlobalDataHowever, confectionery earnings declined in the fourth quarter, driven by a 3.4% drop in margins due to higher costs on sales to the Far East and increased marketing and trade spending.
