Q2-2015: Mattel gross sales down 6.5 percent

BENGALURU:  Mattel, Inc  (Mattel) reported a 6.5 percent decline in gross worldwide sales at US$ 1095.1 million in Q2-2015 (quarter ended June 30, 2015, current quarter) as compared to the US$ 1171.1 million in the corresponding year ago quarter. Net sales dropped 7 percent to US$ 988.2 million in the current quarter as compared to US$ 1062.3 million in Q2-2014. The toymaker reported a net loss of US$ 11.4 million in Q2-2015 as compared to a net profit (income) of US$ 28.3 million in Q2-2014. Last quarter (Q1-2015), Mattel has reported a higher loss of US$ 58.2 million. “In the second quarter, we made solid progress as we work to return Mattel to improved growth and profitability,” said Mattel’s chairman and CEO Christopher Sinclair. “Our financial results in the quarter largely met our expectations, and we are encouraged by improved performance across our core brands, as well as strong momentum in emerging markets like China and Russia. Although we are still early in our turnaround effort, I believe we are taking all the right steps to be more competitive in the growing global toy industry.” Worldwide gross sales for the six-month period ended June 30, 2015 (HY-2015) also declined 4.4 percent to US$ 2115.3 million from US$ 2212.4 million in HY-2014. Net sales in HY-2015 fell 4.9 percent to US$ 1910.9 million as compared to the US$ 2008.4 million in HY-2014. Mattel reported a net loss of US$ 69.5 million during the current six month period as compared a net income of US$ 17.1 million during the corresponding year ago period. Worldwide gross sales by brands Mattel Girls and Boys brands Mattel Girls and Boys brands sales in Q2-2015 declined 12.7 percent to US$ 601.8 million from US$ 689 million in Q2-2014. The effect of the strong US dollar slowed the decline on a constant currency basis to 3 percent. For HY-2015, gross sales of Mattel Girls and Boys brands declined 10.3 percent to US$ 1206.9 million from US$ 1345.8 million in HY-2014. Currency exchange rate change reduced the decline to just 1 percent. Within Mattel Girls and Boys brands, Barbie worldwide gross sales declined 19 percent to US$ to 130.3 million from US$ 160.8 million, with the currency exchange rate change reducing the decline to 11 percent. In HY-2015, Barbie gross sales declined 16.4 percent to US$ 276.3 million from US$ 330.7 million in HY-2014. Currency exchange rate change reduced the drop to 8 percent. Other Girls worldwide gross sales declined 16.6 percent in the current quarter to US$ 175.9 million from US$ 201.9 million in Q2-2014. Currency exchange rate change reduced the drop to 6 percent. HY-2015 Other Girls worldwide sales declined 13.8 percent to US$ 365.4 million from US$ 276.3 million in HY-2014, with currency exchange rate change reducing the decline to 4 percent. Wheels gross worldwide sales increased 14.8 percent in Q2-2015 to US$ 160.6 million from US$ 139.9 million in Q2-2014. Currency exchange rate change improved the growth to 26 percent.  Wheels gross worldwide sales in HY-2015 increased by 8.2 percent to US$ 292.6 million from US$ 270.4 million in HY-2014. Currency exchange rate change improved the growth to 18 percent. Entertainment business, which includes Radica ® and Games declined 23.9 percent in Q2-2015 to US$ 135 million from US$ 177.4 million in Q2-2014. In HY-2015, Entertainment business worldwide sales declined 15 percent to US$ 272.6 million from US$ 320.8 million in the corresponding year ago period. Fisher-Price brands Fisher-Price brands worldwide gross sales increased 2.4 percent to US$ 336.8 million in Q2-2015 as compared to the US$ 328.8 million in Q2-2014. Currency exchange rate change improved the growth to 9 percent. For HY-2015 worldwide gross sales for Fisher-Price brands was flat (grew by 0.7 percent) at US$ 600.7 million as compared to the US$ 600.2 million in HY-2014. Currency exchange rate change improved the growth to 7 percent. Fisher-Price Brands includes the Fisher-Price Core, Fisher-Price Friends and Power Wheels ® brands.  American Girls brands American Girls brands gross sales increased 1.3 percent in Q2-2015 to US$ 84.2 million from US$ 83.1 million in Q2-2014. For HY-2015, gross sales was flat (up 0.6 percent) to US$ 190.2 million from US$ 189.1 million in HY-2014. Construction and Arts & Crafts Brands Construction and Arts & Crafts Brands gross sales grew 5.2 percent to US$ 64.8 million in Q2-2015 from US$ 61.6 million in Q2-2014. For HY-2015, gross sales grew 67.4 percent to US$ 103.1 million from US$ 61.6 million in HY-2014. Sales of Construction and Arts & Crafts products include the Mega Bloks and RoseArt brands.  Mattel acquired Mega Brands Inc. on April 30, 2014. Worldwide gross sales by region North American North American gross sales declined 2.9 percent to US$ 583.6 million in Q2-2015 from US$ 601.2 million in Q2-2014. Currency exchange rate change reduced the fall to 1 percent. For HY-2015, North American gross sales improved 2.5 percent to US$ 1181.7 million from US$ 1153.2 million in HY-2014. Currency exchange rate change improved the growth to 3 percent. International International gross sales declined 10.2 percent to US$ 511.5 million in Q2-2015 from US$ 569.9 million in Q2-2014. Currency exchange rate change had a appositive impact which showed a growth of 5 percent. HY-2015 gross international sales declined 11.9 percent to US$ 933.6 million in Q2-2015 from US$ 1059.2 million in HY-2014, with currency exchange rate change resulting in a growth of 4 percent. Dividend The Mattel board has declared 2015 third quarter cash dividend of $0.38 per share, which is flat compared to the third quarter of 2014.