The Danish toy manufacturer Lego AS (HQ: DK-7190 Billund) has again proved its worth in 1993. Lego products (named from the combination of "LEg GOdt", Danish for "play well") are sold in 127 countries, and worldwide turnover is up by 13%. Turnover of the holding company Lego AS, which consolidates 19 of the 42 subsidiaries, was reported as Dkr 5.3bn (approximately DM 1.4bn) in 1993, with profits up by 25% to Dkr 793m (DM 202m). Turnover for the German subsidiary Lego GmbH (PO Box 1263, D-24591 Hohenwestedt) increased by 16.5%, to an estimated DM 480-500m. The 5,000sqm extensions to the German facility have now been completed, giving the work force of 330 a total space of 20,000sqm for warehousing and administration.

Several factors contributed to this unexpected success, according to Lego GmbH Managing Director, Gerd Balke. Resulting from their misjudgement in anticipating increased growth for electronic games, Lego increased advertising massively and introduced 68 new products (49 in the previous year). These new products accounted for about half of the turnover. Lego has in fact profited from the poor state of the economy, since in Balke's experience, spending on children was the last to be cut. Particularly successful products were the battery-driven train set in the infant "Duplo" range and technical models with 9-volt minimotors in the "Lego Technic" range for 7-16 year olds. Both textiles and plastics are being used in the new "Belville" series, which should delight girls in the age range from 5 to 12.

According to Lego Germany, "creative construction and play with Lego is the main reason for customer loyalty and enthusiasm irrespective of age"; this is also the explanation of Lego's reports of rising market shares last year especially in middle and north Europe as well as the Far East. The company is the only European toy manufacturer to be one of the ten largest in the world, and it intends to increase its market share this year.

The Swiss Lego Production AG (CH-Willisau) is Lego's fifth production site. Advanced environmental measures have been introduced for production, packaging and delivery of Lego bricks. According to Lego, these include recycling of plastic and packaging waste, as well as the use of gases which do not affect the ozone layer. Sfr 165m has been invested in the plant of which Sfr 86m was for building construction. "Appropriate energy use" will play an important role in the new Lego factory.

READER SERVICE: Comprehensive information file "Lego": PIE-No. 35949 – Press information Business Year 1993 Lego GmbH: PIE-No. 35950 – Lego Production Review 1994: PIE-No. 35951.