First Quarter Highlights
* Worldwide net sales up 12 percent;
* Domestic gross sales up 12 percent and international gross sales up 12 percent;
* Worldwide gross sales for core brands: Barbie up 5 percent; Hot Wheels® up 9 percent; Core Fisher-Price up 5 percent and American Girl® brands up 6 percent;
* Gross margin increased 510 basis points of net sales; SG&A decreased 720 basis points of net sales;
* Operating income of $45.2 million compared to operating loss of $55.2 million in the first quarter of 2009; and
* Earnings per share of $0.07 vs. prior year loss per share of $0.14.
Mattel, Inc. (NASDAQ:MAT) today reported 2010 first quarter financial results. For the quarter, the company reported net income of $24.8 million, or $0.07 per share, compared to last year’s first quarter net loss of $51.0 million, or $0.14 per share.
“I am pleased with the performance across our portfolio of brands, including our core brands and our licensed evergreen brands, especially our newest properties World Wrestling Entertainment, Thomas and Friends, and Toy Story”
“I am pleased with the performance across our portfolio of brands, including our core brands and our licensed evergreen brands, especially our newest properties World Wrestling Entertainment, Thomas and Friends, and Toy Story,” said Robert A. Eckert, chairman and chief executive officer of Mattel. “I am also pleased with our continued success in identifying and executing programs that are generating efficiencies across the organization.”
For the quarter, net sales were $880.1 million, up 12 percent compared to $785.6 million last year, including favorable changes in currency exchange rates of 3 percentage points. On a regional basis, first quarter gross sales increased 12 percent in the U.S. and increased 12 percent in international markets, including favorable changes in currency exchange rates of 7 percentage points. Operating income for the quarter was $45.2 million, compared to prior year’s operating loss for the quarter of $55.2 million.
The company’s debt-to-total-capital ratio was 22.4 percent. Consistent with the seasonality of the business, during the quarter the company’s cash and equivalents declined by approximately $245 million, compared with a decline of approximately $213 million in last year’s first quarter.
Sales by Business Unit
Mattel Girls and Boys Brands
For the first quarter, worldwide gross sales for the Mattel Girls & Boys Brands business unit were $573.1 million, up 14 percent versus a year ago. Worldwide gross sales for the Barbie brand were up 5 percent. Worldwide gross sales for Other Girls Brands were up 21 percent, driven by the Disney Princess doll line. Worldwide gross sales for the Wheels category, which includes the Hot Wheels, Matchbox and Tyco R/C® brands, were up 3 percent. Worldwide gross sales for the Entertainment business, which includes Radica and Games and Puzzles, were up 35 percent for the quarter, primarily driven by growth in the World Wrestling Entertainment and Toy Story properties, as well as core games.
First quarter worldwide gross sales for the Fisher-Price Brands business unit, which includes the Fisher-Price® Core, Fisher-Price® Friends and Power Wheels® brands, were $316.2 million, or up 11 percent versus the prior year, primarily driven by sales of products supporting the evergreen entertainment property, Thomas and Friends®, added to the portfolio in 2010, and growth in Fisher-Price® Core.
American Girl Brands
First quarter gross sales for the American Girl Brands business unit, which offers American Girl® branded products directly to consumers, were $70.2 million, up 6 percent versus last year, primarily driven by strong sales of LanieTM, the 2010 Girl of the Year.
Mattel will webcast its 2010 first quarter financial results conference call at 8:30 a.m. Eastern time (5:30 a.m. Pacific time) today. The conference call will be webcast on the "Investors & Media" section of the company's corporate Web site, www.mattel.com. To listen to the live call, log on to the Web site at least 15 minutes early to register, download and install any necessary audio software. An archive of the webcast will be available on the company's Web site for 90 days and may be accessed beginning two hours after the completion of the live call.
A telephonic replay of the call will be available beginning at 11:30 a.m. Eastern time the morning of the call, until midnight Eastern time on April 20th and may be accessed by dialing + 1 (706) 645-9291. The passcode is 61632801.
Information required by Securities and Exchange Commission Regulation G, regarding non-GAAP financial measures, as well as other financial and statistical information, will be available at the time of the webcast on the “Investors & Media” section of http://corporate.mattel.com/, under the sub-headings “Financial Information” – “Earnings Releases.”
Mattel, Inc., (NASDAQ:MAT) (www.mattel.com) is the worldwide leader in the design, manufacture and marketing of toys and family products. The Mattel family is comprised of such best-selling brands as Barbie, the most popular fashion doll ever introduced, Hot Wheels®, Matchbox®, American Girl, Radica and Tyco R/C, as well as Fisher-Price® brands, including Little People, Power Wheels and a wide array of entertainment-inspired toy lines. In 2010, Mattel is named as one of FORTUNE Magazine's "100 Best Companies to Work For" for the third year in a row, and was ranked among Corporate Responsibility Magazine’s "100 Best Corporate Citizens." Mattel also is recognized among the “World’s Most Ethical Companies.” With worldwide headquarters in El Segundo, Calif., Mattel employs approximately 27,000 people in 43 countries and territories and sells products in more than 150 nations.