LEGO announces first half of 2021 financial results – Revenue up 46 percent

The LEGO Group today announced their first-half of 2021 financial results, showcasing stellar growth across all markets.

Testament to all of us chipping in and spending more than ever on LEGO, consumer sales grew 36%, revenue was up 46% to DKK 23 bn (US$3.61 billion), with operating profit doubling, up 104% and net profit up 140%.

Despite these outstanding numbers, LEGO CEO Niels B. Christiansen has flagged that expect growth to stabilise to more sustainable levels, as people return to pre-pandemic spending patterns. This trend, combined with LEGO’s plans to accelerate re-investments into the future of the business, is expected to result in more normalised profit levels moving forward.

LEGO will also be re-investing their profits into initiatives such as investments in a multi-year, enterprise-wide digital transformation.

New digital platforms, products and ways of working will support a long-term ambition to digitally-enable the LEGO brand to create fantastic experiences for children, shoppers, partners and employees.

Digital talent hubs were opened in Shanghai and Copenhagen in addition to the company’s headquarters in Billund and hub in London to support this effort.

The Top 5 themes sold in the first half of 2021 were LEGO City, Star Wars, Technic, Creator Expert and Harry Potter. Some interesting additions here – fans clearly loved the 20th Anniversary LEGO Harry Potter sets, and it’s also great to see Creator Expert in the Top 5 for the very first time – not surprising considering the crazy amount of Creator Expert, 18+, LEGO for Adults sets released.

Curiously, Friends is usually a fixture in LEGO’s Top 5 themes, and didn’t make it this time.

For those wondering, LEGO have also announced that it had completed a successful trial of paper bags designed to replace single-use plastic in boxes and will begin phasing in the new paper packaging from early 2022.

This development ensures the Group remains on track to make all packaging 100 percent sustainable by 2025.

These strong results, have also enabled to increase their support and aid, via the LEGO Foundations – pledging more than DKK 1.5 billion (US$235 million) in donations to agencies which support children and families, especially those in need. This included DKK 940 million (US$150 million) for COVID relief, with a focus on children’s health and development; DKK 140 million (US$23 million) to support children’s education; DKK 100 million (US$15.7 million) to agencies working with families impacted in Haiti and Afghanistan; and funding for programmes which advance learning through play in communities where the LEGO Group operates.

See below for the full press release!

Consumer sales, revenue and operating profit grew double digits. Brought learning through play to more children around the world.

• Consumer sales grew 36 percent.
• Revenue grew 46 percent to DKK 23.0 billion.
• Operating profit grew 104 percent to DKK 8.0 billion. Net profit grew 140 percent to DKK 6.3 billion.
• Free cash flow was strong at DKK 5.8 billion.
• Market share gains globally and in largest markets.
• With the LEGO Foundation, donations of DKK 1.5 billion YTD to support children’s development via learning through play.

Billund, September 28, 2021: The LEGO Group today reported first half earnings for the six months ending June 30, 2021. Revenue for the period grew 46 percent to DKK 23 billion compared with the same period in 2020. Consumer sales grew 36 percent, outpacing the toy industry and driving market share growth globally and in all major markets.

Operating profit was DKK 8 billion, an increase of 104 percent compared with 1H 2020, despite an ambitious programme of strategic investments to support growth in the long term.

The LEGO Group CEO, Niels B. Christiansen said: “We are very pleased with the progress we made across all areas of the business during the first half. Our performance was driven by strong demand for our portfolio, which has attracted new builders to the LEGO® brand. Our year-on-year growth benefited from fewer COVID-related restrictions compared with 2020 as our factories operated uninterrupted and the majority of retail stores re-opened.

“We also saw the benefits of multi-year investments in e-commerce, product innovation and a global supply chain network. Our strong financial performance now allows us to accelerate strategic investments in sustainability and digitalisation.

Christiansen continued: “We are especially grateful for our amazing team. Despite all the challenges and uncertainties of the past six months, they worked extraordinarily hard to bring play to more families around the world.”

All market groups grew double digits

All market groups delivered double-digit consumer sales growth which was driven by excellent execution and a diverse portfolio which appealed to builders of all ages and interests. Top-performing themes included LEGO® City, LEGO® Star Wars™, LEGO® Harry Potter™, LEGO® Creator Expert and LEGO® Technic.

Operating profit more than doubled despite significant investments in major long-term initiatives such as a new retail store format; e-commerce capabilities; an enterprise-wide digital transformation; and efforts to make products and operations more sustainable. Operating profit was also offset by increased freight and raw material costs.

Christiansen said: “As we look ahead to the second half of 2021, we continue to see strong demand for our products. Longer-term, we expect top-line growth to stabilise to more sustainable levels as people return to pre-pandemic spending patterns. This trend, combined with our plans to accelerate re-investments into the future of the business, is expected to result in more normalised profit levels moving forward.

“Our investments are designed to create a sustainable future for the business and advance our mission to have a positive impact on children and the world they will inherit. Digitalisation and sustainability will have an especially critical play in this, and we are extremely pleased with the progress our teams are making in these areas. We will also continue to develop our play experiences and brand expression so that LEGO play is diverse and welcoming for all.”

Building a sustainable future

The company made progress against its ambition to create more sustainable products. In June it unveiled a prototype brick made from recycled single-use PET bottles, an important step in reducing its reliance on non-renewable raw materials. It also completed a successful trial of paper bags designed to replace single-use plastic in boxes and will begin phasing in the new paper packaging from early 2022. This development ensures the Group remains on track to make all packaging 100 percent sustainable by 2025.

Memorable brand experiences online & instore

The LEGO Group’s investments in its physical and digital retail channels paid off in the first half. E-commerce sales across our own and partners’ platforms grew 50 percent compared with the same period last year.

The company also launched a new retail store format which will be introduced to around 60 stores during the second half of 2021. The format was unveiled at the opening of a new flagship store in New York City in June and is designed to create immersive, playful and memorable brand moments.

The LEGO Group continued to expand its global retail footprint opening more than 60 new LEGO branded stores in the first half of 2021, more than 40 in China. This brings the total number of LEGO retail stores as of June 30, to 737, with 291 of those located in China.

During the second half of 2021, the company will accelerate investments in a multi-year, enterprise-wide digital transformation. New digital platforms, products and ways of working will support a long-term ambition to digitally-enable the LEGO brand to create fantastic experiences for children, shoppers, partners and employees. Digital talent hubs were opened in Shanghai and Copenhagen in addition to the company’s headquarters in Billund and hub in London to support this effort.

Positive impact on future generations

The company continued to help children around the world develop via learning through play. More than 1.2 million children benefited from product donations and local community engagement activities.

Year to date, the LEGO Group with the LEGO Foundation, which owns 25 percent of the LEGO Group, pledged more than DKK 1.5 billion (US$235 million) in donations to agencies which support children and families, especially those in need. This included DKK 940 million (US$150 million) for COVID relief, with a focus on children’s health and development; DKK 140 million (US$23 million) to support children’s education; DKK 100 million (US$15.7 million) to agencies working with families impacted in Haiti and Afghanistan; and funding for programmes which advance learning through play in communities where the LEGO Group operates.

Christiansen said: “The single biggest motivating force for everyone at the LEGO Group is knowing we can have a positive impact on future generations. Whether it’s in times of acute need or helping a child develop new skills that will last a lifetime, LEGO play and the LEGO brand can, and will, make a difference. We’re proud to be in this position and are committed to doing all we can to continue to inspire and develop the builders of tomorrow.”