The Character Group PLC saw its shares plummet after it warned that profits for the year to August will come in as much as 10% below market expectations due to a number of global logistical challenges.
The distributor of toys such as Peppa Pig, Pokémon, Heroes of Goo Jit Zu, Fireman Sam and Scooby Doo said that although the lifting of Covid-19 restrictions and subsequent re-opening of physical stores led to buoyant sales in the second half, global supply chain issues have deteriorated further since the company announced its interims in April.
It said profitability has been impacted by delays at ports, shipping and container shortages, exponential increases in freight rates and increased costs of inland transportation in China and the UK, as well as higher raw material and labour costs in China.
“The immediate outlook for an early improvement in supply chain efficiency to ensure timely fulfilment is currently unclear,” the AIM-listed company said.
The group said it finished its financial year with a robust balance sheet, a sizeable cash balance and with substantial unutilised working capital facilities.
Shares were down over 17% at 572.50p mid-morning.