Character Group, the UK-based toy company known for the Peppa Pig brand, has raised its annual profit forecast by 20 percent as it recovers from the impact of trade tariffs introduced during the Trump administration. The company now expects profit before tax to reach £6 million for the fiscal year ending August 31, marking a notable improvement after a challenging period.
Shares in the Aim-listed group climbed to a 12-month high yesterday, closing up 2.9 percent at 318p. This positive movement follows a downturn in revenue reported during the first half of the financial year, which led the company to withdraw its annual market guidance in April due to significant uncertainties surrounding its US operations.
Despite earlier setbacks, Character Group’s updated trading statement projects annual revenues of approximately £100 million, maintaining a level similar to the prior year. Kiran Shah, co-founder and joint managing director, acknowledged the difficulties caused by the tariff measures, which resulted in a near disappearance of the company’s US business. Shah commented that the company had worked hard to reverse these declines and is optimistic about building on its recent progress in the coming year.
A substantial contribution to the improved profit outlook came from a £9.8 million cash injection following the sale of Character Group’s warehouse in Lancashire in July. This sale raised the company’s overall cash reserves to more than £20 million, strengthening its financial position.
Character Group generates about 20 percent of its revenue from the US market and manufactures nearly 95 percent of its products in China. This reliance on Chinese production made the company particularly vulnerable to the escalating trade tensions and tariff disputes between China and the United States.
Founded in 1991, Character Group designs, develops, and distributes toys licensed from well-known franchises, including Doctor Who, Teenage Mutant Ninja Turtles, and the Teletubbies, alongside its flagship Peppa Pig line. The recent trading update signals a recovery from the challenges posed by global trade disruptions, though the company remains attentive to ongoing geopolitical and market risks.