TORONTO - Spin Master shares soared to a post-pandemic high Thursday after the company reported strong first-quarter financial results and said new initiatives will continue to drive growth.

Executives of the Toronto-based toy, game and entertainment company told analysts that digital games and a Paw Patrol movie scheduled for release in August will complement its other business lines.

“Our diversification efforts are bearing fruit, ” said Mark Segal, Spin Master's chief financial officer.

The company's latest outlook projects sales growth in its toy business line to be in the high single digits for the year, compared with a March 2 estimate of low- to mid-single-digit growth.

In addition, it expects its digital games business and its entertainment and licensing business to continue growth through the year and contribute to an overall increase in revenue.

Shares in Spin Master Corp. were initially up more than 10 per cent Thursday after the company reported a first-quarter profit of US$3.2 million as digital games contributed to a nearly 40 per cent increase in overall revenue compared with last year.

Shares gave up some of their gains in later trading. They were up C$2.20 or 5.2 per cent at C$44.70 in early afternoon trading on the Toronto Stock Exchange.

Spin Master, which reports in U.S. dollars, said Wednesday after markets closed that its net income was equal to three cents per diluted share for the quarter ended March 31. That compared with a year-earlier loss of US$26.7 million or 26 cents per diluted share.

On an adjusted basis, Spin Master says it earned eight cents per share for its most recent quarter compared with an adjusted loss 46 cents per share a year ago.

Total revenue rose to US$316.6 million compared with US$227.3 million of revenue in the first quarter of 2020, which included the beginning of the COVID-19 pandemic.

Excluding digital games and entertainment revenue, Spin Master's net product sales rose 24.4 per cent to $255.6 million, driven by the preschool and girls category and outdoor toys. It also generated $61 million in other revenue.

Digital games accounted for $34.1 million of the other revenue, up from $6.9 million a year ago. Entertainment and licensing revenue was $26.9 million, up from $15 million last year.