<PAGE> 1
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------
FORM 10-QSB
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(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTER ENDED JUNE 30, 1997
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD
FROM ________________ TO _________________
COMMISSION FILE NUMBER - 0-28104
JAKKS PACIFIC, INC.
(EXACT NAME OF SMALL BUSINESS ISSUER AS SPECIFIED IN ITS CHARTER)
DELAWARE 95-4527222
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
24955 PACIFIC COAST HWY., B202
MALIBU, CALIFORNIA 90265
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
ISSUER'S TELEPHONE NUMBER, INCLUDING AREA CODE: (310) 456-7799
----------------
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act during the past 12 months (or for
such shorter period that the Registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days.
Yes x No
--- ---
----------------
The number of shares outstanding of the Issuer's common stock is 4,872,969 (as
of August 11, 1997).
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<PAGE> 2
JAKKS PACIFIC, INC. AND SUBSIDIARIES
INDEX TO QUARTERLY REPORT ON FORM 10-QSB
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
QUARTER ENDED JUNE 30, 1997
ITEMS IN FORM 10-QSB
<TABLE>
<CAPTION>
Page
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Facing page
Part I FINANCIAL INFORMATION
Item 1. Financial Statements.
Condensed Consolidated Balance Sheet -
June 30, 1997 (Unaudited) 3
Condensed Consolidated Statements of Operations -
Three and six months ended June 30, 1997
and 1996 (Unaudited) 4
Condensed Consolidated Statements of Cash Flows -
Six months ended June 30, 1997 and 1996 (Unaudited) 5
Notes to Condensed Consolidated Financial
Statements (Unaudited) 6
Item 2. Management's Discussion and
Analysis of Financial Condition
and Results of Operations. 10
Part II OTHER INFORMATION
Item 1. Legal Proceedings and Claims. None
Item 2. Changes in Securities. None
Item 3. Default Upon Senior Securities. None
Item 4. Submission of Matters to
a Vote of Security Holders. None
Item 5. Other Information. None
Item 6. Exhibits and Reports on Form 8-K. 14
Signatures. 16
</TABLE>
2
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JAKKS PACIFIC, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheet
June 30, 1997 (Unaudited)
Assets
<TABLE>
<CAPTION>
<S> <C>
Current assets
Cash $ 5,816,647
Accounts receivable 4,809,595
Inventory 1,981,031
Prepaid expenses and other 2,937,623
-----------
Total current assets 15,544,896
-----------
Property and equipment, at cost 2,849,427
Less accumulated depreciation and amortization 688,089
-----------
Net property and equipment 2,161,338
-----------
Goodwill, net 10,838,613
Trademarks, net 973,029
Other 652,809
-----------
Total assets $30,170,685
===========
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable and accrued expenses $ 3,310,258
Reserve for returns and allowances 369,815
Acquisition debt 3,292,637
Income taxes payable 340,605
-----------
Total current liabilities 7,313,315
-----------
Convertible Debentures 6,000,000
-----------
Total liabilities 13,313,315
-----------
Commitments
Stockholders' equity
Preferred stock, $.001 par value; 5,000 shares
authorized, no shares issued --
Common stock, $.001 par value; 25,000,000 shares authorized;
4,872,969 shares issued and outstanding 4,873
Additional paid-in capital 14,744,873
Retained earnings 2,276,175
-----------
17,025,921
Less unearned compensation from stock option grants 168,551
-----------
Net stockholders' equity 16,857,370
-----------
Total liabilities and stockholders' equity $30,170,685
===========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
3
<PAGE> 4
JAKKS PACIFIC, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
For the Three and Six Months Ended June 30, 1997 and 1996 (Unaudited)
<TABLE>
<CAPTION>
Three Months Ended June 30, Six Months Ended June 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Net sales $8,058,556 $2,381,760 $13,293,752 $3,216,500
Cost of sales 4,855,911 1,573,983 8,179,866 2,017,888
---------- ---------- ----------- ----------
Gross profit 3,202,645 807,777 5,113,886 1,198,612
Selling, general and administrative expenses 2,481,839 634,713 4,220,086 1,038,569
---------- ---------- ----------- ----------
Income from operations 720,806 173,064 893,800 160,043
Other (income) and expense:
Interest expense 181,402 24,433 334,122 53,924
Interest income (64,777) (46,756) (168,293) (47,139)
---------- ---------- ----------- ----------
Income before benefit from income taxes 604,181 195,387 727,971 153,258
(Provision for) Benefit from income taxes (147,563) 6,149 (67,936) 68,090
---------- ---------- ----------- ----------
Net income $ 456,618 $ 201,536 $ 660,035 $ 221,348
========== ========== =========== ==========
Net income per share $ 0.10 $ 0.06 $ 0.15 $ 0.08
========== ========== =========== ==========
Weighted average number of common and common
equivalent shares outstanding 4,752,000 3,376,000 4,539,000 2,791,000
========== ========== =========== ==========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
4
<PAGE> 5
JAKKS PACIFIC, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
For the Six Months Ended June 30, 1997 and 1996 (Unaudited)
<TABLE>
<CAPTION>
Six Months Ended June 30,
1997 1996
<S> <C> <C>
Cash flows from operating activities:
Net income $ 660,035 $ 221,348
---------- ------------
Adjustments to reconcile net income to net cash used
by operating activities:
Depreciation and amortization 691,683 126,547
Change in accounts receivable (2,389,125) (1,384,135)
Change in inventory (1,840,926) 71,892
Net change in other operating assets and liabilities 188,914 (588,236)
---------- -----------
Total adjustments (3,349,454) (1,773,932)
---------- -----------
Net cash used by operating activities (2,689,419) (1,552,584)
--------- -----------
Cash flows from investing activities:
Purchase of property and equipment (1,372,365) (137,122)
Purchase of trademark (1,000,000) --
Excess of cost over toy business assets acquired (goodwill) (6,962,974) --
Increase in other assets (35,721) (22,681)
---------- -----------
Net cash used by investing activities (9,371,060) (159,803)
---------- -----------
Cash flows from financing activities:
Payment of acquisition debt - Justin (191,555) (209,209)
Proceeds from issuance of convertible debentures 6,000,000 1,300,000
Offering costs - convertible debentures (528,532) (195,306)
Proceeds from sale of common stock 2,949,316 7,750,804
Payment of notes payable to officers -- (304,846)
Proceeds from acquisition debt - Road Champs 6,098,939 --
Payment of acquisition debt - Road Champs (2,806,302)
---------- ----------
Net cash provided by financing activities 11,521,866 8,341,443
---------- ----------
Net increase (decrease) in cash (538,613) 6,629,056
Cash, beginning of period 6,355,260 81,752
---------- ----------
Cash, end of period $ 5,816,647 $ 6,710,808
========== ==========
Supplemental disclosure of cash flow information (Note 4):
Cash paid during the period for:
Income taxes $ -- $ 9,100
========== ==========
Interest $ 279,178 $ 46,636
========== ==========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
5
<PAGE> 6
JAKKS PACIFIC, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
June 30, 1997
Note 1 - Basis of presentation
The accompanying 1997 and 1996 unaudited interim condensed consolidated
financial statements included herein have been prepared by the Company, without
audit, pursuant to the rules and regulations of the Securities and Exchange
Commission (the "SEC"). Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such rules and
regulations. However, the Company believes that the disclosures are adequate to
prevent the information presented from being misleading. These financial
statements should be read in conjunction with the financial statements and the
notes thereto included in the Company's Form SB-2, which contains financial
information for the year ended December 31, 1996 and the nine month period from
April 1, 1995 (inception) through December 31, 1995, as declared effective by
the SEC (file number 333-22583) on May 1, 1997.
The information provided in this report reflects all adjustments (consisting
solely of normal recurring accruals) that are, in the opinion of management,
necessary to present fairly the results of operations for this period. The
results for this period are not necessarily indicative of the results to be
expected for the full year.
The consolidated financial statements include the accounts of the Company and
its wholly-owned subsidiaries, JAKKS Acquisition Corp., a Delaware corporation,
J-X Enterprises, Inc., a New York corporation, Road Champs, Inc., a
Pennsylvania corporation, and JP (HK) Limited, JAXXS (HK) Limited and Road
Champs Limited, all of which are Hong Kong corporations. In consolidation, all
significant intercompany balances and transactions are eliminated.
Earnings per share has been computed using the weighted average number of
common shares and common share equivalents (which consists of Warrants and
Options, to the extent they are dilutive). The difference between primary and
fully diluted earnings per share is immaterial.
6
<PAGE> 7
JAKKS PACIFIC, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
June 30, 1997
Note 2 -- Issuance of convertible debentures
On January 8, 1997, the Company issued two $3,000,000 convertible
debentures for a total of $6,000,000. Interest on the principal amounts
outstanding will accrue at 9.0% per annum with the first monthly installment
payable on February 1, 1997. If not sooner redeemed or converted into common
stock, the debentures shall mature on December 31, 2003. Commencing on December
31, 1999, and the first day of each successive month thereafter prior to
maturity, mandatory principal redemption installments must be made, each of such
installments to be in the amount of $10 per $1,000 of the then remaining
principal amount of the debenture. Such debentures are convertible at $5.75 per
share into 1,043,478 shares of the Company's common stock, subject to reset and
anti-dilution provisions. A stock pledge agreement has been entered into with
the Company pledging as security all outstanding shares of the Company's
wholly-owned subsidiaries. In addition, all marketing and manufacturing licenses
acquired or to be acquired, and all machinery and equipment to the extent
assignable by the Company have also been pledged as security. As compensation
paid to an investment banker, 6% of the gross proceeds was paid in cash and
warrants for the purchase of 150,000 shares of common stock, exercisable at
$8.00 per share, were sold for $0.001 per share.
Note 3 - Acquisition
On February 6, 1997, the Company acquired all of the stock of Road Champs,
Inc. and all of the operating assets of an affiliated company for approximately
$12,496,000, as adjusted. Consideration paid at closing was approximately
$4,609,000 in cash plus the issuance of $1,500,000 (198,020 shares) of the
Company's common stock. The balance of the adjusted purchase price of
approximately $3,189,000 is to be paid in three equal installments, with the
third installment payable one year after the closing of the transactions all of
which will carry interest at a rate of 7.0% per annum. In addition, the payment
for inventory of approximately $2,189,000, without interest, is payable within
30 days of shipment to customers and the balance was paid on August 6, 1997,
and a payment of $1,009,000 which was made on May 8, 1997. Outstanding balances
are secured by all acquired shares and assets, however, they are subordinate
to the security interest for the convertible debentures noted above.
Note 4 -- Supplemental information to statements of cash flows
198,020 shares of common stock were issued as partial consideration for toy
business assets acquired totalling $1,500,000 in 1997. The excess of cost over
toy business assets acquired (goodwill) is reflected in the consolidated
statement of cash flows net of the stock issued.
7
<PAGE> 8
JAKKS PACIFIC, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Continued)
June 30, 1997
Note 5 -- Recent accounting pronouncements
In February 1997, the FASB issued SFAS No. 128, "Earnings per Share" which
is required to be implemented for fiscal years ending after December 15, 1997
and earlier application is not permitted. SFAS No. 128 replaces current
"primary earnings per share" ("primary EPS") and "fully diluted earnings per
share" ("fully diluted EPS") with "basic earnings per share" ("basic EPS") and
"diluted earnings per share" ("diluted EPS"). Unlike the calculation of primary
EPS which includes, in the denominator, the sum of (1) actual weighted shares
outstanding and (2) "common stock equivalents" as that term is defined in the
authoritative accounting literature, basic EPS is calculated using only the
actual weighted average shares outstanding during the relevant periods. Diluted
EPS is very similar to fully diluted EPS, differing only in technical ways which
do not currently affect the Company.
The FASB issued a new standard, SFAS No. 123 "Accounting for Stock-Based
Compensation," which contains a fair value-based method for valuing stock-based
compensation that entities may use, which measures compensation cost at the
grant date based on the fair value of the award. Compensation is then recognized
over the service period, which is usually the vesting period. Alternatively, the
standard permits entities to continue accounting for employee stock option and
similar equity instruments under APB Opinion No. 25, " Accounting for Stock
Issued to Employees." Entities that continue to account for stock options using
APB Opinion No. 25 are required to make pro forma disclosures of net income and
earnings per share, as if the fair value-based method of accounting defined in
SFAS No. 123 had been applied. Management accounts for options under APB Opinion
No. 25. If the alternative accounting-related provisions of SFAS No. 123 had
been adopted as of the beginning of 1995, the effect on 1997 and 1996 net income
and earnings per share would have been immaterial.
In March 1995, the FASB issued SFAS No. 121, "Accounting for the Impairment
of Long-Lived Assets and for Long-Lived Assets To Be Disposed Of". SFAS No. 121
addresses the accounting for the impairment of long-lived assets, certain
identifiable intangible assets and goodwill related to those assets to be held
and used. It also addresses the accounting for long-lived assets and certain
identifiable intangibles to be disposed of. SFAS No. 121 establishes guidance
for recognizing and measuring impairment losses and requires that the carrying
amount of impaired assets be reduced to fair value. SFAS No. 121 was effective
for fiscal years beginning after December 15, 1995. The impact of the adoption
of SFAS No. 121 did not have a material adverse effect on the Company's
financial condition or results of operations.
Note 6 - Common stock
On May 6, 1997 and June 18, 1997, the Company issued 600,000 shares and
90,000 shares, respectively, of its Common Stock at a price of $5.75 per share
in connection with its public offering.
8
<PAGE> 9
JAKKS PACIFIC, INC. AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 1997 AND 1996
The following discussion and analysis should be read together with the Company's
Condensed Consolidated Financial Statements and Notes thereto which appear
elsewhere herein.
Overview
The Company commenced operations July 1, 1995 through the acquisition of
substantially all of the assets comprising the toy business of Justin Products
Limited ("Justin"), a Hong Kong Corporation, and the Company has included the
results of the operations acquired from Justin in its consolidated financial
statements from the effective date of the acquisition, July 1, 1995.
In 1996, the Company expanded its product lines to include products based on
licensed characters and properties such as World Wrestling Federation action
figures and Power Rangers ZEO and Turbo mini vehicles.
Effective February 1, 1997, the Company acquired Road Champs, Inc., a
developer, manufacturer and marketer of die cast toy and collectible vehicles.
Results of Operations
Three Months Ended June 30, 1997 and 1996
Net income for the three months ended June 30, 1997 totaled $456,618, or $0.10
per share, compared to net income of $201,536, or $0.06 per share, for the
comparable period in 1996. This variance is attributable to the following:
Net Sales. Net sales were $8,058,556 in 1997 and $2,381,760 in 1996, an increase
of $5,676,796 or 238.3%. This increase in net sales was primarily the result of
continued sales of the World Wrestling Federation action figures and the
sales of the recently acquired Road Champs product line from February 1, 1997.
Other products contributing to the results were the Company's holiday doll
line, Power Rangers Turbo vehicles and the Reactor line of radio controlled
vehicles which was launched this quarter.
Gross Profit. Gross profit increased as a percentage of net sales to 39.7% in
1997 from 33.9% in 1996. This increase as a percentage of net sales was due to
increasing sales of products featuring licensed characters and properties with
higher after-royalty margins, as well as due to the semi-fixed nature of
amortization of molds and tools which decrease as a percentage of net sales
as net sales increase.
Selling, General and Administrative Expenses. Selling, general and
administrative expenses were $2,481,839 in 1997 and $634,713 in 1996,
constituting 30.8% and 26.6% of net sales, respectively. The overall dollar
increase of $1,847,126 and increase as a percentage of net sales were due to the
increase in variable selling
10
<PAGE> 10
expenses, including freight, sales commission and travel expenses, which is
attributable to the significant increase in net sales, as well as to staffing
and infrastructure additions for the Company and expenses related to the
operations of Road Champs.
Interest, Net. The Company had various interest-bearing instruments outstanding
during 1997 and 1996. Such instruments included those issued pursuant to private
offerings and the Road Champs acquisition in 1997. In 1997, the total principal
and average outstanding balance of such instruments were significantly higher
than in 1996 resulting in an increase in interest expense of $156,969, or 642%,
which was partially offset by increased interest income of $18,021, or 39%,
received on the Company's average cash balance. The average cash balance in 1997
was significantly higher than in 1996 due to the receipt of net proceeds from
certain convertible debentures issued in January 1997 in connection with
financing provided to the Company, resulting in a significant increase in
interest income.
Income Taxes. In 1996, the Company experienced a tax benefit related
to its U.S. operations while the earnings arising in, or derived from, Hong
Kong benefited from a favorable effective tax rate of 16.5% compared to
approximately 45% combined U.S. effective tax rate. In 1997, the Company
recorded a provision for taxes based on its estimated effective tax rate which
resulted in an increase in income taxes from 1996 in the amount of $153,712.
Six Months Ended June 30, 1997 and 1996
Net income for the six months ended June 30, 1997 totaled $660,035 or $0.15 per
share compared to net income of $221,348 or $0.08 per share, for the comparable
period in 1996. This variance is attributable to the following:
Net Sale. Net sales were $13,293,752 in 1997 and $3,216,500 in 1996, an
increase of $10,077,252 or 313%. This increase in net sales was primarily the
result of continued sales of the World Wrestling Federation action figures,
fashion dolls, Power Rangers Turbo vehicles, the recently acquired Road Champs
product line of die cast toys and vehicles and the launch of the Reactor radio
controlled vehicle.
Gross Profit. Gross profit increased as a percentage of net sales to 38.5% in
1997 from 37.3% in 1996. The increase as a percentage of net sales was due to
a change in the product mix which consisted more of higher margin lines such
as dolls, action figures and vehicles in 1997. Another contributing factor is
that amortization of molds and tools is semi-fixed and, accordingly, decreases
as a percentage of net sales as net sales increase.
Selling, General and Administrative Expense. Selling, general and
administrative expense were $4,220,086 in 1997 and $1,038,569 in 1996
constituting 31.7% and 32.3% of net sales, respectively. The decrease as a
percentage of net sales was primarily due to the significant increase in net
sales. The overall dollar increase of $3,181,517 was due to the increase in
variable selling expenses including freight, sales commissions and travel
expenses, which is attributable to the significant increase in net sales, as
well as to staffing and infrastructure additions for the Company and
expenses related to the operations of Road Champs.
Interest, Net. The company had various interest-bearing instruments
outstanding during 1997 and 1996. Such instruments included those issued
pursuant to private offerings and the Road Champs acquisition in 1997. In 1997,
the total principal and average outstanding balance of such instruments were
significantly higher than in 1996 resulting in an increase in interest expense
of $280,198, or 520%, which was partially offset by increased interest income
of $121,154, or 257% received on the Company's cash balances.
Income Taxes. In 1996, the Company experienced a tax benefit related to its
U.S. operations while the earnings arising in, or derived from, Hong Kong
benefitted from a favorable effective tax rate of 16.5% compared to
approximately 45% combined U.S. effective tax rate. In 1997, the Company
recorded a provision for taxes based on its estimated effective tax rate which
resulted in an increase in income taxes from 1996 in the amount of $136,026.
11
<PAGE> 11
Liquidity and Capital Resources
As of June 30, 1997 the Company had working capital of $8,231,581 as compared to
$7,824,155 at December 31, 1996. The change was due to proceeds received from
the issuance of the convertible debentures pursuant to a private offering and
the secondary offering of the Company's common stock and offset by the purchase
of Road Champs, the consideration of which consisted of cash, common stock and
debt. During the six months ended June 30, 1997, operating activities of the
Company used cash of $2,689,419, which resulted from an increase of $2,389,125
in accounts receivable due to higher sales at the end of the second quarter of
1997 as compared to the end of fourth quarter of 1996 as well as from the
increase in inventory of $1,840,926 acquired primarily in connection with the
Road Champs acquisition, offset by net income and non-cash charges to income of
$660,035 and $691,683, respectively.
Financing activities for the six month period ended June 30, 1997 provided cash
of $11,521,866, due primarily to the issuance of convertible debentures in the
principal amount of $6,000,000, the issuance of debt in the amount of $6,098,939
as part of the purchase price for the Company's acquisition of Road Champs and
proceeds from the sale of common stock of $2,949,316. Offsetting the proceeds of
these issuances were offering costs related to the debentures as well as a
public offering of the Company's common stock and the payment of acquisition
debt related to the Justin and Road Champs acquisitions.
The Company's investing activities for the six month period ended June 30, 1997
were primarily related to the purchase of molds and tooling ($1,372,365) and
goodwill ($6,962,974 net of $1,500,000 in common stock issued), and trademarks
($1,000,000) in connection with the acquisition of Road Champs. The Company, in
keeping with its strategy to develop and market new products using entertainment
properties and characters, is continually pursuing licenses for such usage and
expects to continue to invest in this area.
Management believes that the existing cash resources and working capital and
cash expected to be provided from operations will be sufficient to meet the cash
needs of the Company for the foreseeable future. Although operating activities
are expected to provide cash, to the extent the Company grows significantly in
the future, its operating and investing activities may use cash and,
consequently, such growth may require the Company to obtain additional sources
of financing. The foregoing forward-looking statements and information relating
to the Company are based on the beliefs of Management, as well as assumptions
made by and information currently available to the Company. When used in this
paragraph, or elsewhere in this document, the words "anticipate," "believe,"
"estimate," and "expect" and similar expressions, as they relate to the Company,
are intended to identify forward-looking statements. Such statements reflect the
current views of the Company with respect to future events and are subject to
certain risks, uncertainties and assumptions. Should one or more of these risks
or uncertainties materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those described herein as anticipated,
believed, estimated or expected. The Company does not intend to update these
forward-looking statements.
12
<PAGE> 12
PART II. OTHER INFORMATION
13
<PAGE> 13
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibit No.
3.1 Restated Certificate of Incorporation of the Company(1)
3.2.1 By-Laws of the Company(1)
3.2.2 Amendment to By-Laws of the Company(2)
*27 Financial Data Schedule
_________________________
* Filed herewith.
(1) Filed previously as an exhibit to the Company's Registration Statement
on Form SB-2 (File No. 333-2048-LA), dated May 1, 1996, and incorporated
herein by reference.
(2) Filed previously as an exhibit to the Company's Registration Statement
on Form SB-2 (File No. 333-22583) which became effective on April 24,
1997, and incorporated herein by reference.
14
<PAGE> 14
(b) Report on Form 8-K
No Current Reports on Form 8-K were filed during the second quarter
of 1997.
15
<PAGE> 15
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant has caused this report to be signed on its behalf by the undersigned,
thereto duly authorized.
Registrant:
JAKKS PACIFIC, INC.
Date: August 11, 1997 By: /s/ Jack Friedman
---------------------------------
President
(Principal Executive Officer)
Date: August 11, 1997 By: /s/ Joel M. Bennett
---------------------------------
Chief Financial Officer
(Principal Financial and
Accounting Officer)
16
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<CASH> 5,816,647
<SECURITIES> 0
<RECEIVABLES> 4,809,595
<ALLOWANCES> 0
<INVENTORY> 1,981,031
<CURRENT-ASSETS> 15,544,896
<PP&E> 2,849,427
<DEPRECIATION> 688,089
<TOTAL-ASSETS> 30,170,685
<CURRENT-LIABILITIES> 7,313,315
<BONDS> 6,000,000
0
0
<COMMON> 4,873
<OTHER-SE> 16,852,497
<TOTAL-LIABILITY-AND-EQUITY> 30,170,685
<SALES> 13,293,752
<TOTAL-REVENUES> 13,293,752
<CGS> 8,179,866
<TOTAL-COSTS> 8,179,866
<OTHER-EXPENSES> 4,220,086
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 334,122
<INCOME-PRETAX> 727,971
<INCOME-TAX> 67,936
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 660,035
<EPS-PRIMARY> 0.15
<EPS-DILUTED> 0.15
</TABLE>
