BENGALURU: Mattel, Inc (Mattel) reported a 2.5 per cent decline in worldwide revenue at US$ 922.7 million in Q1-2015 (quarter ended 31 March, 2015 – current quarter) as compared to the US$ 946.2 million in the corresponding year ago quarter. The toymaker reported a loss of US$ 58.2 million in Q1-2015 as compared to a loss of US$ 11.2 million in Q1-2014. The results were better than expected by Wall Street pundits.
Company speak
“In the first quarter, we took a number of steps to implement a rapid turnaround at Mattel,” said Mattel’s new chairman and CEO Christopher Sinclair. “We are already benefitting from better decision making, alignment and enhanced accountability. And we’ve begun to refocus our culture on creativity, innovation and improving our speed to market. While we still have a lot of work to do, we’re starting to see progress with our core brands like Barbie and Fisher-Price, and I am confident we are making the changes necessary to perform better in the future.” Sinclair had stepped in on January 26, 2015 when Bryan Stockton resigned from his position as chairman and CEO, as well as from the board of directors of Mattel.
For Q1-2015, net sales were up 5 per cent in constant currency compared to Q1-2104. On a regional basis, first quarter gross sales increased 9 per cent in constant currency, and 8 per cent as reported, in the North American region, which consists of the United States, Canada and American Girl. For the international region, gross sales increased 2 per cent in constant currency, and decreased 14 per cent as reported. Gross margin decreased 210 basis points of net sales, partially due to the acquisition of Mega Brands. Adjusted other selling and administrative expenses increased 90 basis points of net sales, and 300 basis points as reported. Adjusted operating loss for the quarter was US$ 14.6 million, compared to prior year’s adjusted operating income of US$ 27.7 million.
Sales by brands
Girls and Boys brands
Mattel’s Girls and Boys brands reported a 7.9 per cent drop in worldwide sales to US$ 605.2 million in Q1-2015 as compared to the US$ 655.9 million in Q1-2014. However, accounting for a 9 per cent negative impact of currency, actual sales improved by about 1 per cent.
Barbie sales declined 14.1 per cent in Q1-2015 to US$ 146 million from US 169.9 million in Q1-2014. However, accounting for a 9 per cent negative impact of currency, actual sales declined by about 5 per cent.
Other Girls sales declined 10.9 per cent in the current quarter to US$ 189.6 million from US$ 212.9 million. However, accounting for a 10 per cent negative impact of currency, actual sales declined by about 1 per cent.
Wheels sales improved by 1 per cent to US$ 132.1 million from US$ 130.7 million in the corresponding year ago quarter. Accounting for 9 per cent negative impact of currency, actual sales improved by about 10 per cent.
Entertainment sales declined 4.1 per cent in Q1-2015 to 137.5 million from US$ 143.4 million in Q1-2014. However, accounting for a 8 per cent negative impact of currency, actual sales declined by about 4 per cent.
Fisher-Price brands
Fisher-Price brands which includes the Fisher-Price Core, Fisher-Price Friends and Power Wheels brands, reported a 2.7 per cent decline in Q1-2015 at US$ 264 million from US$ 271.4 million in the corresponding year ago quarter. However, accounting for a 6 per cent negative impact of currency, actual sales improved by about 3 per cent.
American Girls brands
American Girls brands reported almost worldwide flat sales at US$ 106.1 million in Q1-2015 as compared to the US$ 105.9 million in Q1-2014.
Construction and Art & Crafts brands
Construction and Art & Crafts brands, which includes the MEGA BLOKS and RoseArt brands reported revenue of US$ 38.3 million in Q1-2015. Mattel acquired Mega Brands Inc. on 30 April, 2014 and so comparable y-o-y numbers have not been mentioned.