Lego running out of toys

The Danish toy maker is having a hard time keeping up with demand for its popular plastic building blocks as toy stores stock their inventories for the holiday season, company officials said on Tuesday.

"Many of our most popular products are sold out," Lego spokesperson Charlotte Simonsen said.

"As part of efforts to restructure the company and focus on our core business, we had to make some cuts and the company has not had time to readjust its production."

Simonsen declined to say how many orders had been turned down, but said the restructuring had affected the production of Duplo bricks and boxes with Lego City, Star Wars and Lego Technik sets.

The Billund, Denmark-based group has been trimming its staff at home and abroad since starting a restructuring programme four years ago.

Part of its production and distribution has been moved to countries with lower wages than Denmark, including the Czech Republic and Mexico.

In 2005, Lego sold its four Legoland amusement parks in Denmark, Britain, California and Germany to the US-based private equity group Blackstone Capital Partners.

Boersen, Denmark's leading financial newspaper, estimated that Lego could lose 750m kroner because of lost Christmas sales.

But Mads Nipper, a vice president at Lego in charge of marketing, said that figure was too high.

"We don't know what the Christmas sales will be like until Christmas is over," Nipper said.

The group posted a net profit of 505m kroner in 2005, compared with a net loss of 1.93bn kroner in 2004, on strong sales led by its Bionicle line of snap-together creatures.

Founded in 1932 by Ole Kirk Christiansen, the name Lego was invented by combing the first two letters of the Danish words "Leg godt" (play well) without knowing that the word in Latin means "I assemble".