A toy story putting some of the fun back into Funtastic

The toy importer and distributor went public nine years ago, appreciated sixfold to $2.75, but then fell in one almighty hole, losing a mind-numbing $95 million over the past 18 months. The scrip fell as low as 11?.

But things are changing; there have been four departures from the board in little more than a year, new management and shareholding blood has moved in, there was a recent $22 million issue, three or four businesses have been sold and excess debt has been cut.

The company has trimmed itself back to being a toy and entertainment business; importing and distributing toys and sporting goods for kids, and a division known as Madman which brings in films ranging from Ben 10 to Midsomer Murders.

Whether Funtastic manages to pull off its rebirthing depends a great deal on the efforts of a few key people.

First is Stewart Downs, 42, who was appointed chief executive early this year. He is credited with turning Mattel Australia into one of the toy giant's better-performing international divisions.

Then there is Nir Pizmony, 50, who is regarded as something of a genius when it comes to toys.

He is no stranger to Funtastic. He joined the board in 2002 when the company bought his big, privately held toy business.

Pizmony resigned from the board in 2004 when Funtastic scrip was around its peak levels.

Earlier this year, Funtastic raised $22 million, and bought a business Pizmony built up since leaving Funtastic; a Hong Kong-based designer and developer of toys that holds the global master toy licence for Noddy.

He rejoined the Funtastic board in September and now has his foot on a slab of equity which may increase as a result of earn-out agreements.

Personality number three is Craig Mathieson, 41, son of Don Mathieson, who sold his glass business to CSR for a fortune, and nephew of hotel owner Bruce Mathieson.

Mathieson recently underwrote Funtastic's issue, and ended up taking a sizeable shortfall at 13.5? a share. More fool those who didn't take up the shares as they are now 23?.

Identity number four is Lachlan Keith Murdoch. He appears to hold about 13 per cent.

As well as taking up the shortfall, Craig Mathieson has been buying shares in the open market and he's now up to about 91 million shares. His entitlement, along with the Pizmony family, is about 34 per cent of the company.

Funtastic is valued by the market at $78 million, which suggests an expectation of improved results for calendar 2010 is built into the share price.

Funtastic's June half loss was $11 million before interest, tax and amortisation, excluding goodwill and restructuring costs. Directors noted there was much to be done in the current half which would influence the 2009 calendar year results.