Tech 4 Kids Announces Organizational Changes; Mershon Joins Team
Tech 4 Kids announces organizational changes to its sales and marketing teams, which the company says will position it for growth into 2017. Rick Mershon is joining the company as senior vice-president of sales in early December. He brings extensive experience and understanding of the North American market to his new role. Mershon joins the company from Blip Toys. He also held senior sales management positions at Summit Toys and worked as an independent sales representative at a number of notable sales agencies.
Additionally, Steve Beilman will transition to the new role of vice-president of international sales, effective immediately. Graeme Bissett who was previously serving as international sales manager returns to the marketing department, taking on the responsibility of marketing manager working alongside Hugh Kennedy. Bissett will be overseeing responsibilities in licensing as well as helping guide the strategy in digital and social marketing campaigns.
Carmela Bucarelli joins the team as senior brand manager and Saoirse Minden joins as brand manager.
TIA Fights Back Against “Harmful” Toy Lists with Facts
The Toy Industry Association (TIA) is reaching out to families this holiday season in an effort to fight back against the misleading reports circulated by non-governmental organizations (NGOs) regarding allegedly “harmful” toys.
“The toy community remains steadfast in its year-round commitment to creating safe toys and games that bring joy and learning to children all over the world. However, each holiday season, a small group of non-governmental organizations seeks to generate publicity and donations for themselves with their alleged ‘unsafe’ toy reports,” said Steve Pasierb, TIA president and CEO. “These reports are not backed up with credible, scientific data, and instead needlessly frighten families during an otherwise joyful time of year. In fact, all toys sold in the U.S. are highly regulated 365 days a year by the federal government and must meet more than 100 safety requirements.”
TIA has conducted a thorough analysis of U.S. Public Interest Research Group’s (PIRG) 2015 “Trouble in Toyland” report and W.A.T.C.H’s 2015 “10 Worst Toys” list. The analysis revealed that the data provided by these groups is unreliable and consistently fails to support their allegations that the listed toys present any danger to children at play.
Here are the Facts:
- None of the toys that PIRG and W.A.T.C.H. named in their reports have been recalled by the U.S. Consumer Product Safety Commission (CPSC), the federal agency charged with overseeing toy safety, as a result of their allegations.
- W.A.T.C.H. does not test any of the toys it claims are unsafe. Their allegations are based on pure conjecture and opinion.>li
- PIRG also failed to use proper toy-testing methods. Only one out of the 23 products named in PIRG’s report was properly tested by the group for safety.
TIA welcomes independent monitoring and analysis by outside parties—as long as these activities are carried out in a responsible manner. Unfortunately, groups like PIRG and W.A.T.C.H. do nothing to advance toy safety and are not serving the interests and well-being of children and their families.
TIA was a vigorous supporter of the Consumer Product Safety Improvement Act, the federal consumer product safety legislation adopted in 2008, and works year-round with medical experts, consumer groups, and government regulators to ensure the safety of children and maintain U.S. toy safety standards, which are among the strictest in the world. TIA educates toymakers on how to meet these standards and provides consumers with accurate facts about toy safety.
Visit TIA’s www.PlaySafe.org, an online repository of toy safety facts, recall information, and tips for safe play.
Target Reports Q3
Target Corporation reported a third quarter 2016 comparable sales decline of 0.2 percent and GAAP earnings per share (EPS) from continuing operations of $1.06, an increase of 39.7 percent from third quarter 2015. Third quarter adjusted earnings per share from continuing operations, which excludes the favorable resolution of income tax matters and certain items related to the pharmacy transaction, was $1.04, an increase of 22.1 percent from third quarter 2015.
“We are very pleased with our third quarter financial results, which reflect meaningful improvement in our traffic and sales trends and much stronger-than-expected profitability,” said Brian Cornell, chairman and CEO of Target. “Favorable gross margin mix and efficient execution by our team drove third quarter EPS performance well beyond our guidance. We also continued to gain market share in key Signature Categories and saw unexpectedly strong sales in the Back-to-School and Back-to-College season. As we move into the biggest quarter of the year, we are pleased with our inventory position and confident that our team will deliver a great guest experience as they bring our merchandising and marketing plans to life throughout the holiday season.”
Fourth Quarter and Fiscal 2016 Guidance
Target raised its expectations for fourth quarter comparable sales and now expects growth in the range of (1.0) percent to 1 percent, compared with prior guidance of (2.0) percent to flat. In the fourth quarter of 2016, Target expects both GAAP EPS from continuing operations and adjusted EPS of $1.55 to $1.75.
For full-year 2016, Target now expects GAAP EPS from continuing operations of $4.67 to $4.87, compared with prior guidance of $4.36 to 4.76. The company expects full-year 2016 adjusted EPS of $5.10 to $5.30, compared with prior guidance of $4.80 to $5.20. The 43-cent difference between these ranges reflects early debt-retirement losses and a small benefit from the resolution of income tax matters.
Fourth quarter and full-year 2016 GAAP EPS from continuing operations may include the impact of unforeseen discrete items, which may be excluded in calculating adjusted EPS. Target is not currently aware of any such discrete items beyond those already reported in the first, second and third quarters of 2016.
Third quarter 2016 sales decreased 6.7 percent to $16.4 billion from $17.6 billion last year, reflecting a 0.2 percent decline in comparable sales combined with the removal of pharmacy and clinic sales from this year’s results. Comparable digital channel sales grew 26 percent and contributed 0.7 percentage points to comparable sales growth. Segment earnings before interest expense and income taxes (EBIT), which is Target’s measure of segment profit, were $1,057 million in third quarter 2016, an increase of 9.9 percent from $962 million in 2015.
Third quarter EBITDA and EBIT margin rates were 9.9 percent and 6.4 percent, respectively, compared with 8.6 percent and 5.5 percent, respectively, in 2015. Third quarter gross margin rate was 30.2 percent, compared with 29.4 percent in 2015, reflecting the benefit of the sale of the company’s pharmacy and clinic businesses and strong Signature Category sales growth. Third quarter SG&A expense rate was 20.3 percent in 2016, compared with 20.7 percent in 2015, reflecting continued expense discipline across the organization.
Interest Expense and Taxes from Continuing Operations
The company’s third quarter 2016 net interest expense was $142 million, compared with $151 million last year. Third quarter 2016 effective income tax rate from continuing operations was 33.8 percent, compared with 34.3 percent last year. The decrease was due to a variety of factors, none of which was individually significant.
Target returned $1.2 billion to shareholders in third quarter 2016, including:
- Dividends of $345 million, compared with $352 million in third quarter 2015.
- Share repurchases totaling $878 million, including open market transactions that retired 8.1 million shares of common stock at an average price of $69.73, for a total investment of $564 million. An accelerated share repurchase (ASR) agreement that retired 4.6 million shares of common stock at an average price of $67.67, for a total investment of $314 million. Final settlement of the ASR occurred in November, and 1.3 million of the 4.6 million shares repurchased through the ASR were delivered in the fourth quarter.
In September 2016, Target’s board of directors authorized a new $5 billion share repurchase program. Repurchases through this program will begin upon completion of the prior $10 billion program. At the end of the third quarter, including the $314 million investment in the ASR, $300 million of capacity remained under the prior program.
For the trailing 12 months through third quarter 2016, after-tax return on invested capital (ROIC) was 16.3 percent, compared with 13 percent for the 12 months through third quarter 2015. Excluding the net gain on the sale of the pharmacy and clinic businesses, ROIC for the trailing 12 months through third quarter 2016 was 14.3 percent, reflecting higher profits on a modestly lower base of invested capital.
Play Fair 2017 Tickets Now Available
The Toy Industry Association (TIA) and LeftField Media announced that tickets for Play Fair 2017 are now available. Play Fair brings children, parents, and families together with the toys, characters, and brands they love in celebration of play for all ages. Play Fair, presented by Nickelodeon and Toys “R” Us, will take place in New York City’s Javits Center on November 4-5, 2017. A Press and Industry Preview Night will kick off the show on November 3.
Launched in 2016 in conjunction with TIA’s North American International Toy Fair, the first Play Fair welcomed more than 20,000 attendees and brands including Nickelodeon, Toys “R” Us, LEGO, Hasbro, Mattel, and Cartoon Network. Growing in its second year, Play Fair will expand to double in size and will take place during the prime pre-holiday shopping season.
Play Fair 2017 highlights include:
- More than 150,000 square feet of exhibit space
- Screenings, photo ops, and interactive experiences with fan-favorite Nickelodeon characters
- Expanded Toys “R” Us stage featuring amazing premieres and celebrity appearances
- A massive LEGO pavilion letting kids (and parents) build
- New and expanded displays including K’NEX, Entertainment One, OgoSport, and Snazaroo
- New focused pavilions dedicated to STEM & Maker Toys, Arts & Crafts, and Video Games
- Limited ticketed events including pizza parties, cupcake parties, and parent workshops
- Svan Wooden Toys playground and imagination arena featuring the award-winning game Tall Tales: The Game of Infinite Storytelling from SCS Direct
- Preview Night on Friday, Nov. 3 for toy industry professionals and media
Families can purchase tickets to Play Fair 2017 to attend either morning or afternoon sessions, available now at the “super early bird” rate of only $20 per person for a limited time. New for 2017 is a VIP ticket option, which offers an additional hour of play along with an exclusive goodie bag filled with some of the hottest toys of the year for only $50.
Tickets can be purchased now at playfairny.com.