NewsWire: Funtastic Acquires LotR Australian Toy Distribution License - The Age

Funtastic's distribution rights flow from it's relationship with US toy giant Toy Biz, which will manufacture the Lord of the Rings merchandise.

Funtastic lands the Lord's rings
The Age

Funtastic, the local distributor of Barbie, Spiderman and the Pokemon range of toy products, has acquired a Hollywood licence expected to generate up to $10 million in additional revenue.

The licence covers toys and other merchandise to be released alongside the film version of J.R.R Tolkein's much-loved fantasy epic, The Lord of the Rings. The first movie in the trilogy will screen next year.

Funtastic managing director David Hendy said he expected consumer hype surrounding the films - to be produced and released in quick succession - to be "very close, if not bigger" than Jurassic Park.

"The beauty of this is there's three movies," he said. "Often a movie comes and then goes, whereas these we've got one, two, three."

Funtastic said The Lord of the Rings was one of the "most immense and magnificent projects in the history of film", and described the associated licence as one of the most coveted in Hollywood.

"It's a classic story, it's very adventurous, it's got a lot of characters so there's a lot of fantasy play in it. That's all very good for toy sales," Mr Hendy said.

Based on the product range he had seen recently in New York, Mr Hendy said Funtastic could expect "somewhere between $4 million and $10 million" in revenue, with a profit margin of more than 40 per cent.

Funtastic recorded sales of $31.5 million in 1999, and has forecast $35.4 million in revenue for the current calendar year.

Despite the expected boost to sales, the market was unmoved by the announcement, closing unchanged at 45 cents.

Mr Hendy said he believed Funtastic's share price was yet to reflect the dynamics of the company, the first of its kind to float on the local exchange. "It's brand new and they (investors) are not jumping on to it as quickly as I'm sure they will in the future," he said. Funtastic listed on the Australian Stock Exchange earlier this month at an issue price of 50 cents a share.

Mr Hendy said the company hoped to announce further deals in the coming months, with several opportunities currently "in the pipeline".

The Lord of the Rings distribution rights flow from Funtastic's relationship with US toy giant Toy Biz, which will manufacture the merchandise.

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