Hatchimals ‘egg’ developed in Philippines by D&L subsidiary
D&L INDUSTRIES, Inc. has revealed its wholly owned subsidiary developed the key material that made the “Hatchimals” product of children’s entertainment company Spin Master Corp. a sensation.
In a statement issued on Tuesday, the listed company disclosed that D& L Polymer and Colours, Inc. (DLPC) manufactures the material for the product featuring a plastic egg that hatches into an interactive furry toy.
The material is particularly used in the plastic egg, allowing it to hatch without splintering. DLPC developed the material for TradeWalker Limited, a Hong Kong- based solution provider for the toy manufacturing industry.
“The Hatchimals project had very specific requirements,” DLPC Managing Director Lester A. Lao noted in the statement.
“Essentially, we were trying to replicate the structure and texture of an eggshell. That’s where our special material comes in. It makes the egg strong enough to withstand shipping and handling but also fragile and breakable enough to hatch open.”
Aside from making the eggshell realistic, DLPC was concerned about making the product safe for children during the development stage.
“Not only did it need to be non-toxic, but the egg had to break without leaving sharp edges. It also needed to be designed so that it would hatch within a specified time frame,” explained Mr. Lao, who also heads First In Colours, Inc., another D&L Industries subsidiary.
The end use of the material was initially kept confidential to DLPC during the development stage, with Mr. Lao saying: “During the development process, the concept had to be kept under wraps and since our customer couldn’t disclose the end use, we just had to keep adapting the formulation.”
Hatchimals has received strong reception since its launch in October 2016 in over 50 countries, according to Spin Master.
In a disclosure to the Toronto Stock Exchange last month, Spin Master Ltd. Global President and Chief Operating Officer Ben J. Gadbois noted that demand for Hatchimals had been “beyond anything we could have predicted.”
Spin Master has since increased production and expedited shipment of Hatchimals. The company plans to introduce the toy to Asian markets, as it expands and builds the brand this year and beyond.
The development of customized materials aligns with D&L Industries’ long-term strategy that entails attracting more customers and keeping existing ones by formulating products in accordance with a particular client’s needs.
“Our goal is to maintain our focus on innovation,” Mr. Lao said. “Our R&D (research and development) work is an important reason why clients continue to rely on us to come up with solutions, just like what we did for the Hatchimals toy.”
In the first nine months of 2016, D&L Industries booked a 19% year-on-year increase in net income to P1.93 billion, reflecting a 10% jump in sales to P15.95 billion. Shares in D&L Industries ended flat at P12.30 apiece on the Philippine Stock Exchange on Tuesday.