Character Group Withdraws Forecast Amid US Tariff Concerns
(Reuters) - Britain's Character Group withdrew its annual forecast on Friday, as the manufacturer of popular children's brands such as "Peppa Pig" and "Teletubbies" said it expects the effects of U.S. tariffs on China to be felt in the second half.
Still, the children's toys and products maker, which is also a third-party distributor for licenses such as "Teenage Mutant Ninja Turtles" expects to remain profitable in the current financial year.
WHY IT MATTERS
Companies such as Character Group are bracing for the effects of a prolonged trade war, as U.S. President Donald Trump's extensive tariffs have disrupted global supply chains and heightened concerns about a potential global recession.
Trump imposed new tariffs on Chinese goods shortly after taking office, and has since raised them to 145% in response to Beijing also raising levies on the U.S., which has led to rising tensions between the world's top two economies.CONTEXT
London-listed Character Group, which manufactures the largest range of "Peppa Pig" products, predominantly counts UK and Scandinavia as its key markets.
U.S. sales accounted for about 20% of the company's turnover in 2024.
In its 2024 annual report, it said that in order to maintain competitive pricing, it mainly outsources its production operations to China.
KEY QUOTE
The board's visibility for forecasting U.S. sales and its ability to assess the financial implications have been considerably obscured by tariffs, the company said.
BY THE NUMBERS
In January, the company forecast annual profit before tax to be in line with market view and at similar levels to those reported in 2024.
MARKET REACTION
Character Group's shares crashed nearly 11% at 230 pence early on Friday.
(Reporting by Anandita Mehrotra in Bengaluru; Editing by Varun H K)
