Annual Report 2008

For the LEGO Group, 2008 was a successful year with considerable increases in both sales and profit. This was announced when the LEGO Group presented its Annual Report 2008 at a press conference today in Billund, Denmark.

• Profit for the year before tax reached DKK 1,852 million against DKK 1,414 million in 2007.
• Net profit for the year amounted to DKK 1,352 million against DKK 1,028 million in 2007.
• The Group’s equity increased from DKK 1,679 million at the end of 2007 to DKK 2,066 million at the end of 2008.
• Revenue amounted to DKK 9,526 million against DKK 8,027 million in 2007, an increase of 18.7%.

Global sales increases

Nearly all the LEGO Group’s markets reached two-digit growth rates in 2008. Especially the English-speaking markets saw extraordinarily high sales increases, which resulted in considerable increases of the LEGO Group’s shares of these markets. In Central Europe, the LEGO products increased their market leadership through continued growth, and in Northern and Eastern Europe, the strong position of the LEGO products was further strengthened during 2008.

Classic play themes such as LEGO City are still among the largest product lines. LEGO Star Wars also achieved extensive growth in 2008, and moreover the launch of the licensed product LEGO Indiana Jones was very successful.

The global market for traditional toys saw a slight decrease in 2008. A moderate decrease was seen on the American toy market, whereas the world’s second largest toy market, Japan, saw extensive decreases. On the other Asian markets and on the Eastern European markets, toy sales were increasing, whereas markets stagnated in Western Europe in 2008. The LEGO Group has increased its market share on all its markets.

Expectations for 2009

The development in 2009 is subject to great uncertainty. Already under pressure, the toy market is expected to be increasingly affected in 2009 by the worldwide recession.

Nevertheless, the LEGO Group expects moderate sales increases in 2009. In order to support this growth, the LEGO Group is planning to continue its investments in the development of markets and products as well as production capacity. On this basis, satisfactory results are expected for 2009.

CEO Jørgen Vig Knudstorp

”Our results for 2008 have been extraordinarily good”, says Mr Jørgen Vig Knudstorp, President and CEO. ”And this applies not only to the financial results. During 2008 we also took over two factories in the Czech Republic and Hungary, and we began the construction of a factory in Mexico. The successful change to increased own production, combined with strong sales increases, is attributable to the impressive performance by all our employees.” ”Despite gloomy economic prospects, we feel well prepared for growth in 2009 as well, and our optimism is supported by the results seen in the first months of the year,” says Mr Knudstorp.