Funtastic (ASX: FUN) has recorded a first half profit of $35.4 million for the first-half of FY18, representing a rare bit of positive news for the ailing Australian retail sector.
The listed company revealed its net profit of $35.4 million was up from a $4.3m loss in the first-half last year.
The positive numbers was achieved mostly through debt restructuring and the company's revenue fell 31 per cent to $28 million, from the first half result in 2017 of $40.6 million.
These results come at a time when the retail sector in Australia is suffering, primarily due to the dominance of online shopping.
Last week the retail sector was hit with more bad news when it was announced all of the 885 Toys R Us stores in the United States are due to close this year after the toy retailer went bankrupt.
Funtastic says the implementation of key strategic initiatives, such as a refinancing that reduced company debt by $35 million, and raising $8.2 million in equity last year, has paid off.
The company also says it has re-engaged with major factories and suppliers, including a major contract renewal with Razor - the global leader in electric and push scooters.
For the rest of the financial year, the company says it is focusing on building and growing its brands in the Toys & Plus business, as well as grow its apparel contracts and secure additional licencing and agency agreements with tech and confectionary groups.
E-commerce is also at the forefront of the company's plans, with Funtastic looking to drive customers to online, as well as implementing social marketing and looking for new channels of distribution.
The company has struggled since 2013, hitting shareholders with multiple profit warnings mostly thanks to a number of disappointing toy launches and acquisitions.
Shareholders last year knocked back a proposal to delist the company from the ASX, in a bid by the board to save on listing fees.
The company pushed ahead with the debt restructure and in September undertook a capital raising of $8.2 million.
Never miss a news update, subscribe here. Follow us on Facebook, LinkedIn, Instagram and Twitter.
Business News Australia
Get our daily business news
Sign up to our free email news updates.
Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support