How do you tell a frog on a log from a bump on a log? Sometimes by color. Rarely by earnings results -- and certainly not by the results posted by educational technology company LeapFrog Enterprises (NYSE:LF).

Now, granted, no one in the toy industry has been looking particularly healthy lately. Motley Fool Inside Value pick Mattel has barely kept ahead of the anemic gains of the S&P 500 over the past year. Motley Fool Stock Advisor selection Hasbro (NYSE:HAS) is actually lagging the S&P. And Taiwan's Vtech (OTC BB: VTKHY.PK) is underperforming the average by a whopping 27%.

Even against this backdrop, though, it's LeapFrog that looks most green around the gills -- down 57% over the past 12 months. And while its stock perked up a bit last week in response to a less-bad-than-expected earnings release, there really wasn't a lot to by hoppy about. (Sorry. Any pun in a storm.)

Sales rose 0.4% year on year. Worse, absent the favorable impact of foreign exchange rates, sales would have been down 0.4%. But wait -- it gets worse still. Profits went missing, but losses mounted since last year's first quarter. Losses per diluted share rose 60% to $0.32 per share. And the only reason that those losses weren't as bad as the firm's total net loss (69%) was because share dilution spread the hurt among a greater number of shares than were existent one year ago.

If there was a bright side to Thursday's earnings news, it was that the company continued to produce strong free cash flow in Q1 (albeit a bit less strong than one year ago). The past three months saw $88.6 million in cash flow LeapFrog's way, and judging from the cash flow statement, the bulk of this came in the form of bills getting paid late. Accounts receivable declined by nearly $160 million between the end of December 2004 and the close of Q1 2005.

However, this is a pattern that appears to repeat itself every year at LeapFrog. Receivables stay pretty low in quarters one and two and then grow through the second half of each year. So to be sure that the free cash flow that we're seeing indicates a turnaround in the making, we'll need to monitor the trend over the course of a few quarters.

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Fool contributor Rich Smith owns shares of Hasbro but not of any other company mentioned in this article. The Motley Fool has a disclosure policy.