TORONTO (Reuters) - Canadian toy company Mega Brands
The Montreal-based company said on Friday it earned $72 million, or $1.22 a share, for the quarter, compared with a year-earlier loss of $122.1 million, or $3.34 a share, which included a $150 million pre-tax charge for impairment of goodwill and other assets.
Excluding one-time items, the company earned $6.9 million, or 14 cents per share, in the latest quarter.
Revenue dropped 26.7 percent to $118 million due to lower sales in both of its product lines.
Earlier this week Mega Brands said it had settled legal action related to Rose Art, which it purchased from the Rosen family in 2005.
Under the settlement, Mega Brands received $17.2 million and dropped a $200 million counterclaim against the Rosens.
Mega Brands is still recovering from a recall of its Magnetix toys, which began in 2006 and expanded in 2007. One child died and 27 were seriously injured after swallowing small, powerful magnets that came loose from the magnetic toys, which were acquired as part of the takeover of Rose Art.
In March 2008, the company announced two separate recalls after reports of magnets coming loose from several toys manufactured in China.
The company decided to downsize operations in the former Rose Art manufacturing facility in China and outsource production.
($1=$1.05 Canadian)
(Reporting by Scott Anderson; editing by John Wallace)
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