Mega Bloks Inc. showed a significant turnaround in the first quarter thanks to a major acquisition.
The company reported a profit of $578,000 US (2 cents a share) for the first quarter, Friday, compared with a loss of $1.2 million US (4 cents a share) a year earlier.
The company's consolidated global net sales increased 178 per cent to $81.5 million as a result of the acquisition of New Jersey-based Rose Art Industries last year.
Mega Bloks 3-month chart
Sales in North America alone almost quadrupled to $61.4 million from $15.5 million in the first quarter of 2005 with the inclusion of stationery and activities sales that came with the Rose Art purchase. There was also strong overall growth in toys, the company said.
Earnings from operations were $3.9 million US compared to a loss from operations of $1.4 million in the same quarter of last year.
Earlier this week, Mega Bloks said it had fired Lawrence Rosen as CEO of Rose Art after he joined a lawsuit against Mega Bloks. The lawsuit alleges that Mega Bloks failed to pay out about $50 million US for financial targets met by Rose Art. Rosen has been joined by his brother, Jeffrey, and father, Sidney in the suit.
Shares of Mega Bloks rose 44 cents on Friday, finishing at $22.44 on the TSX.
