©2021 Mattel
- Second quarter Net Sales of
$860.1 million , up 2% as reported, and up 5% in constant currency, versus prior year. - Gross Sales of
$962.3 million , up 1% as reported, and up 4% in constant currency. - Dolls category Gross Sales up 3% as reported, and up 6% in constant currency; Barbie®Gross Sales up 9% as reported, and up 13% in constant currency.
- Vehicles category Gross Sales flat as reported, and up 3% in constant currency; Hot Wheels® Gross Sales up 5% as reported, and up 9% in constant currency.
- Infant, Toddler and Preschool category Gross Sales down 13% as reported, and down 11% in constant currency; Fisher-Price® and Thomas & Friends® Gross Sales down 6% as reported, and down 4% in constant currency.
- Action Figures,
Building Sets and Games categories combined Gross Sales up 21% as reported, and up 23% in constant currency. - Structural Simplification run-rate savings of
$754 million , exceeding target of$650 million exiting 2019 six months ahead of schedule; expect to achieve another$100 million of run-rate savings by the end of the year. - Reported Gross Margin of 39.7%, an improvement of 960 basis points; Adjusted Gross Margin of 39.9%, an improvement of 950 basis points.
- Reported Operating Loss of
$51.4 million , an improvement of$137.8 million ; Adjusted Operating Loss of$30.4 million , an improvement of$103.9 million . - Fourth consecutive quarter of year-over-year improvement in Gross Margin, Operating Profit / Loss, EBITDA and EPS.
- Cumulative improvement in reported Operating Income over the past four quarters is
$677 million , the largest improvement in any four consecutive quarters in over 15 years.
Ynon Kreiz, Chairman and CEO,
For the second quarter, Net Sales were up 2% as reported, and up 5% in constant currency, versus the prior year’s second quarter. Gross Sales were up 1% as reported, and up 4% in constant currency. Reported Operating Loss was
For the first six months of the year, Net Sales were flat as reported, and up 3% in constant currency, versus the prior year’s first six months. Gross Sales were down 1% as reported, and up 3% in constant currency. Reported Operating Loss was
Financial Overview
For the second quarter, Net Sales in the
Gross Sales in the
Net Sales in the International segment increased 5% as reported, and 11% in constant currency, versus the prior year’s second quarter.
Gross Sales in the International segment increased 3% as reported, primarily driven by growth in Action Figures,
Gross Sales in the International segment increased 9% in constant currency, primarily driven by growth in Action Figures,
Net Sales in the American Girl® segment decreased by 22% as reported, and in constant currency, versus the prior year’s second quarter.
Gross Sales in the American Girl segment decreased by 23% as reported, and in constant currency, primarily driven by lower sales in proprietary retail and direct channels.
Reported Gross Margin increased to 39.7% versus 30.1% in the prior year’s second quarter and Adjusted Gross Margin increased to 39.9% versus 30.4%.
The increase in Reported and Adjusted Gross Margin was primarily driven by savings from our Structural Simplification program, lower obsolescence and foreign exchange.
Reported Other Selling and Administrative Expenses decreased by
For the six months ended
Sales by Categories
For the second quarter, Worldwide Gross Sales for Dolls were
Worldwide Gross Sales for Infant, Toddler and Preschool were
Worldwide Gross Sales for Vehicles were
Worldwide Gross Sales for Action Figures,
Conference Call and Live Webcast
At
Forward-Looking Statements
This press release contains a number of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The use of words such as “anticipates,” “expects,” “intends,” “plans,” “confident that” and “believes,” among others, generally identify forward-looking statements. These forward-looking statements are based on currently available operating, financial, economic and other information, and are subject to a number of significant risks and uncertainties. A variety of factors, many of which are beyond our control, could cause actual future results to differ materially from those projected in the forward-looking statements. Specific factors that might cause such a difference include, but are not limited to: (i) Mattel’s ability to design, develop, produce, manufacture, source and ship products on a timely and cost-effective basis, as well as interest in and purchase of those products by retail customers and consumers in quantities and at prices that will be sufficient to profitably recover Mattel’s costs; (ii) downturns in economic conditions affecting Mattel’s markets which can negatively impact retail customers and consumers, and which can result in lower employment levels, lower consumer disposable income and spending, including lower spending on purchases of Mattel’s products; (iii) other factors which can lower discretionary consumer spending, such as higher costs for fuel and food, drops in the value of homes or other consumer assets, and high levels of consumer debt; (iv) potential difficulties or delays
Non-GAAP Financial Measures
To supplement our financial results presented in accordance with generally accepted accounting principles in
This earnings release and our earnings slide presentation are available on
Gross Sales
Gross Sales represent sales to customers, excluding the impact of Sales Adjustments. Net Sales, as reported, include the impact of Sales Adjustments, such as trade discounts and other allowances.
Adjusted Gross Profit and Adjusted Gross Margin
Adjusted Gross Profit and Adjusted Gross Margin represent reported Gross Profit and Reported Gross Margin, respectively, adjusted to exclude asset impairments, severance and restructuring expenses and the impact of the inclined sleeper product recalls. Adjusted Gross Margin represents Mattel’s Adjusted Gross Profit, as a percentage of Net Sales. Adjusted Gross Profit and Adjusted Gross Margin are presented to provide additional perspective on underlying trends in Mattel’s core Gross Profit and Gross Margin, which
Adjusted Other Selling and Administrative Expenses
Adjusted Other Selling and Administrative Expenses represents Mattel’s Reported Other Selling and Administrative Expenses, adjusted to exclude asset impairments, non-recurring executive compensation, severance and restructuring expenses, the impact of the inclined sleeper product recalls, and sale of assets, which are not part of Mattel’s core business. Adjusted Other Selling and Administrative Expenses is presented to provide additional perspective on underlying trends in Mattel’s core other selling and administrative expenses, which
Adjusted Operating Income (Loss)
Adjusted Operating Income (Loss) represents Mattel’s reported Operating Loss, adjusted to exclude the impact of asset impairments, non-recurring executive compensation, severance and restructuring expenses, sale of assets, and the impact of the inclined sleeper product recalls, which are not part of Mattel’s core business. Adjusted Operating Income (Loss) is presented to provide additional perspective on underlying trends in Mattel’s core operating results, which
Adjusted Earnings (Loss) Per Share
Adjusted Earnings (Loss) Per Share represents Mattel’s Reported Diluted Earnings (Loss) Per Common Share, adjusted to exclude the impact of asset impairments, severance and restructuring expenses, and the impact of the inclined sleeper product recalls, which are not part of Mattel’s core business. The aggregate tax effect of the adjustments is calculated by tax effecting the adjustments by the current effective tax rate, adjusting for certain discrete tax items, and dividing by the reported weighted average number of common shares. Adjusted Earnings (Loss) Per Share is presented to provide additional perspective on underlying trends in Mattel’s core business.
EBITDA and Adjusted EBITDA
EBITDA represents Mattel’s Net Income (Loss), adjusted to exclude the impact of interest expense, taxes, depreciation and amortization. Adjusted EBITDA represents EBITDA adjusted to exclude the impact of asset impairments, share-based compensation, severance and restructuring expenses, sale of assets, and the impact of the inclined sleeper product recalls, which are not part of Mattel’s core business.
Constant currency
Percentage changes in results expressed in constant currency are presented excluding the impact from changes in currency exchange rates. To present this information,
About
MAT-FIN MAT-CORP
MATTEL, INC. AND SUBSIDIARIES |
EXHIBIT I | |||||||||||||||||||||||||||||||||||||||
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CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)1 |
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For the Three Months Ended June 30, |
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For the Six Months Ended June 30, |
|||||||||||||||||||||||||||||||||||||
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|
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|
Yr / Yr |
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Yr / Yr |
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|
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|
|
|
|
|
|
Yr / Yr |
|
Yr / Yr |
|||||||||||||||||
|
|
|
|
|
|
|
|
|
% Change |
|
% Change |
|
|
|
|
|
|
|
|
|
% Change |
|
% Change |
|||||||||||||||||
(In millions, except per share and |
2019 |
|
2018 |
|
as |
|
in Constant |
|
2019 |
|
2018 |
|
as |
|
in Constant |
|||||||||||||||||||||||||
percentage information) |
$ Amt |
|
% Net Sales |
|
$ Amt |
|
% Net Sales |
|
Reported |
|
Currency |
|
$ Amt |
|
% Net Sales |
|
$ Amt |
|
% Net Sales |
|
Reported |
|
Currency |
|||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||
Net Sales |
$ |
|
860.1 |
|
$ |
|
840.7 |
|
2 |
% |
5 |
% |
$ |
|
1,549.3 |
|
$ |
|
1,549.1 |
|
0 |
% |
3 |
% |
||||||||||||||||
Cost of sales |
518.7 |
|
60.3 |
% |
587.5 |
|
69.9 |
% |
-12 |
% |
968.1 |
|
62.5 |
% |
1,077.0 |
|
69.5 |
% |
-10 |
% |
||||||||||||||||||||
Gross Profit |
341.4 |
|
39.7 |
% |
253.2 |
|
30.1 |
% |
35 |
% |
32 |
% |
581.2 |
|
37.5 |
% |
472.1 |
|
30.5 |
% |
23 |
% |
27 |
% |
||||||||||||||||
Advertising and promotion expenses |
84.5 |
|
9.8 |
% |
82.4 |
|
9.8 |
% |
3 |
% |
154.0 |
|
9.9 |
% |
153.2 |
|
9.9 |
% |
0 |
% |
||||||||||||||||||||
Other selling and administrative expenses |
308.3 |
|
35.8 |
% |
360.0 |
|
42.8 |
% |
-14 |
% |
609.6 |
|
39.3 |
% |
784.6 |
|
50.6 |
% |
-22 |
% |
||||||||||||||||||||
Operating Loss |
(51.4 |
) |
-6.0 |
% |
(189.2 |
) |
-22.5 |
% |
-73 |
% |
-72 |
% |
(182.4 |
) |
-11.8 |
% |
(465.8 |
) |
-30.1 |
% |
-61 |
% |
-62 |
% |
||||||||||||||||
Interest expense |
46.2 |
|
5.4 |
% |
43.5 |
|
5.2 |
% |
6 |
% |
93.2 |
|
6.0 |
% |
84.5 |
|
5.5 |
% |
10 |
% |
||||||||||||||||||||
Interest (income) |
(1.5 |
) |
-0.2 |
% |
(1.7 |
) |
-0.2 |
% |
-10 |
% |
(3.8 |
) |
-0.2 |
% |
(4.8 |
) |
-0.3 |
% |
-22 |
% |
||||||||||||||||||||
Other non-operating (income) expense, net |
(0.3 |
) |
3.1 |
|
1.6 |
|
2.5 |
|
||||||||||||||||||||||||||||||||
Loss Before Income Taxes |
(95.8 |
) |
-11.1 |
% |
(234.0 |
) |
-27.8 |
% |
-59 |
% |
-58 |
% |
(273.4 |
) |
-17.6 |
% |
(547.9 |
) |
-35.4 |
% |
-50 |
% |
-51 |
% |
||||||||||||||||
Provision for income taxes |
12.2 |
|
6.9 |
|
18.3 |
|
4.3 |
|
||||||||||||||||||||||||||||||||
Net Loss |
$ |
|
(108.0 |
) |
-12.6 |
% |
$ |
|
(240.9 |
) |
-28.7 |
% |
-55 |
% |
$ |
|
(291.7 |
) |
-18.8 |
% |
$ |
|
(552.2 |
) |
-35.6 |
% |
-47 |
% |
||||||||||||
Net Loss Per Common Share - Basic |
$ |
|
(0.31 |
) |
$ |
|
(0.70 |
) |
$ |
|
(0.84 |
) |
$ |
|
(1.60 |
) |
||||||||||||||||||||||||
Weighted average number of common shares |
345.9 |
|
344.6 |
|
345.9 |
|
344.5 |
|
||||||||||||||||||||||||||||||||
Net Loss Per Common Share - Diluted |
$ |
|
(0.31 |
) |
$ |
|
(0.70 |
) |
$ |
|
(0.84 |
) |
$ |
|
(1.60 |
) |
||||||||||||||||||||||||
Weighted average number of common and potential common shares |
345.9 |
|
344.6 |
|
345.9 |
|
344.5 |
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||
1 Amounts may not foot due to rounding. |
MATTEL, INC. AND SUBSIDIARIES | EXHIBIT II | |||||||
CONDENSED CONSOLIDATED BALANCE SHEETS1 | ||||||||
June 30, |
|
December 31, |
||||||
2019 |
|
2018 |
|
2018 |
||||
(In millions) | (Unaudited) | |||||||
Assets | ||||||||
Cash and equivalents |
$ |
194.1 |
|
$ |
228.6 |
|
$ |
594.5 |
Accounts receivable, net |
755.7 |
|
780.1 |
|
970.1 |
|||
Inventories |
722.4 |
|
715.3 |
|
542.9 |
|||
Prepaid expenses and other current assets |
243.3 |
|
327.3 |
|
245.0 |
|||
Total current assets |
1,915.5 |
|
2,051.3 |
|
2,352.4 |
|||
Property, plant, and equipment, net |
595.8 |
|
719.7 |
|
657.6 |
|||
Right-of-use assets, net2 |
317.1 |
|
- |
|
- |
|||
Other noncurrent assets |
2,218.2 |
|
2,282.4 |
|
2,233.4 |
|||
Total Assets |
$ |
5,046.6 |
|
$ |
5,053.4 |
|
$ |
5,243.5 |
Liabilities and Stockholders' Equity | ||||||||
Short-term borrowings |
$ |
45.0 |
|
$ |
80.0 |
|
$ |
4.2 |
Accounts payable and accrued liabilities2 |
1,007.0 |
|
1,014.3 |
|
1,238.4 |
|||
Income taxes payable |
22.6 |
|
3.1 |
|
10.0 |
|||
Total current liabilities |
1,074.6 |
|
1,097.4 |
|
1,252.6 |
|||
Long-term debt |
2,855.2 |
|
2,848.2 |
|
2,851.7 |
|||
Noncurrent lease liabilities2 |
284.9 |
|
- |
|
- |
|||
Other noncurrent liabilities |
410.6 |
|
443.8 |
|
469.7 |
|||
Stockholders' equity |
421.3 |
|
664.0 |
|
669.5 |
|||
Total Liabilities and Stockholders' Equity |
$ |
5,046.6 |
|
$ |
5,053.4 |
|
$ |
5,243.5 |
SUPPLEMENTAL BALANCE SHEET AND CASH FLOW DATA (Unaudited)1 | ||||||||
June 30, |
||||||||
2019 |
2018 |
|||||||
Key Balance Sheet Data: | ||||||||
Accounts receivable, net days of sales outstanding (DSO) |
79 |
|
84 |
|
||||
Six Months Ended June 30, |
||||||||
(In millions) |
2019 |
2018 |
||||||
Condensed Cash Flow Data: | ||||||||
Cash flows used for operating activities |
$ (401 |
) |
$ (557 |
) |
||||
Cash flows used for investing activities |
(44 |
) |
(85 |
) |
||||
Cash flows provided by (used for) financing activities and other |
44 |
|
(209 |
) |
||||
Decrease in cash and equivalents |
$ (400 |
) |
$ (851 |
) |
||||
1 |
Amounts may not foot due to rounding. | ||||||||||
2 |
Mattel adopted ASU 2016-02, Leases (Topic 842), on January 1, 2019 using the modified retrospective transition method. Upon adoption, Mattel recorded a right-of-use asset and lease liability on its balance sheet. Prior periods were not retrospectively adjusted. |
MATTEL, INC. AND SUBSIDIARIES | EXHIBIT III | |||||||||||||||||||||
WORLDWIDE GROSS SALES INFORMATION (Unaudited)1 | ||||||||||||||||||||||
RECONCILIATION OF GAAP AND NON-GAAP FINANCIAL MEASURES | ||||||||||||||||||||||
For the Three Months Ended June 30, |
|
For the Six Months Ended June 30, |
||||||||||||||||||||
(In millions, except percentage information) |
2019 |
|
2018 |
|
% Change |
|
% Change in |
|
2019 |
|
2018 |
|
% Change |
|
% Change in |
|||||||
Worldwide Gross Sales: | ||||||||||||||||||||||
Net Sales |
$ |
860.1 |
$ |
840.7 |
2 |
% |
5 |
% |
$ |
1,549.3 |
$ |
1,549.1 |
0 |
% |
3 |
% |
||||||
Sales Adjustments2 |
|
102.2 |
|
113.4 |
|
193.1 |
|
205.0 |
||||||||||||||
Gross Sales |
$ |
962.3 |
$ |
954.1 |
1 |
% |
4 |
% |
$ |
1,742.4 |
$ |
1,754.1 |
-1 |
% |
3 |
% |
||||||
Worldwide Gross Sales by Categories:3 | ||||||||||||||||||||||
Dolls |
$ |
273.4 |
$ |
266.6 |
3 |
% |
6 |
% |
$ |
526.3 |
$ |
524.0 |
0 |
% |
4 |
% |
||||||
Infant, Toddler and Preschool |
|
252.0 |
|
288.0 |
-13 |
-11 |
|
445.6 |
|
514.6 |
-13 |
-11 |
||||||||||
Vehicles |
|
214.1 |
|
215.0 |
0 |
3 |
|
397.5 |
|
404.0 |
-2 |
3 |
||||||||||
Action Figures, Building Sets and Games |
|
222.7 |
|
184.4 |
21 |
23 |
|
373.0 |
|
311.5 |
20 |
22 |
||||||||||
Gross Sales |
$ |
962.3 |
$ |
954.1 |
1 |
% |
4 |
% |
$ |
1,742.4 |
$ |
1,754.1 |
-1 |
% |
3 |
% |
||||||
Supplemental Gross Sales Disclosures | ||||||||||||||||||||||
Worldwide Gross Sales by Top 3 Power Brands: | ||||||||||||||||||||||
Barbie |
$ |
186.5 |
$ |
170.7 |
9 |
% |
13 |
% |
$ |
350.0 |
$ |
323.4 |
8 |
% |
13 |
% |
||||||
Hot Wheels |
|
175.2 |
|
167.3 |
5 |
9 |
|
325.7 |
|
312.2 |
4 |
9 |
||||||||||
Fisher-Price and Thomas & Friends |
|
222.4 |
|
236.2 |
-6 |
-4 |
|
394.8 |
|
424.0 |
-7 |
-4 |
||||||||||
Other |
|
378.1 |
|
379.9 |
0 |
2 |
|
671.8 |
|
694.5 |
-3 |
-1 |
||||||||||
Gross Sales |
$ |
962.3 |
$ |
954.1 |
1 |
% |
4 |
% |
$ |
1,742.4 |
$ |
1,754.1 |
-1 |
% |
3 |
% |
||||||
1 |
Amounts may not foot due to rounding. | |||||||||||||||||||
2 |
Sales Adjustments are not allocated to individual products. As such, Net Sales are not presented on a categories or brand level. | |||||||||||||||||||
3 |
Mattel modified its reporting structure for revenues in the first quarter of 2019 to disclose revenues by categories. Refer to Note 23, Segment Information, in the Form 10-Q for additional information. |
MATTEL, INC. AND SUBSIDIARIES |
EXHIBIT IV |
||||||||||||||||||||
GROSS SALES BY SEGMENT (Unaudited)1 | |||||||||||||||||||||
RECONCILIATION OF GAAP AND NON-GAAP FINANCIAL MEASURES | |||||||||||||||||||||
For the Three Months Ended June 30, |
|
For the Six Months Ended June 30, |
|||||||||||||||||||
(In millions, except percentage information) |
2019 |
|
2018 |
|
% Change |
|
% Change in |
|
2019 |
|
2018 |
|
% Change |
|
% Change in |
||||||
North America Segment Gross Sales: | |||||||||||||||||||||
Net Sales |
$ |
422.9 |
$ |
412.7 |
2 |
% |
3 |
% |
$ |
764.3 |
$ |
738.9 |
3 |
% |
4 |
% |
|||||
Sales Adjustments2 |
|
24.5 |
|
30.2 |
|
52.5 |
|
52.4 |
|||||||||||||
Gross Sales |
$ |
447.4 |
$ |
442.9 |
1 |
% |
1 |
% |
$ |
816.7 |
$ |
791.3 |
3 |
% |
3 |
% |
|||||
North America Gross Sales by Categories:3 | |||||||||||||||||||||
Dolls |
$ |
93.3 |
$ |
84.1 |
11 |
% |
11 |
% |
$ |
173.6 |
$ |
153.4 |
13 |
% |
13 |
% |
|||||
Infant, Toddler and Preschool |
|
142.6 |
|
161.3 |
-12 |
-11 |
|
250.6 |
|
280.1 |
-11 |
-10 |
|||||||||
Vehicles |
|
88.6 |
|
92.2 |
-4 |
-4 |
|
173.6 |
|
175.4 |
-1 |
-1 |
|||||||||
Action Figures, Building Sets and Games |
|
122.8 |
|
105.3 |
17 |
17 |
|
219.0 |
|
182.4 |
20 |
20 |
|||||||||
Gross Sales |
$ |
447.4 |
$ |
442.9 |
1 |
% |
1 |
% |
$ |
816.7 |
$ |
791.3 |
3 |
% |
3 |
% |
|||||
Supplemental Gross Sales Disclosures | |||||||||||||||||||||
North America Gross Sales by Top 3 Power Brands: | |||||||||||||||||||||
Barbie |
$ |
78.5 |
$ |
69.2 |
13 |
% |
14 |
% |
$ |
147.8 |
$ |
129.6 |
14 |
% |
14 |
% |
|||||
Hot Wheels |
|
68.6 |
|
70.8 |
-3 |
-3 |
|
135.6 |
|
134.3 |
1 |
1 |
|||||||||
Fisher-Price and Thomas & Friends |
|
124.6 |
|
128.5 |
-3 |
-3 |
|
221.2 |
|
228.3 |
-3 |
-3 |
|||||||||
Other |
|
175.7 |
|
174.5 |
1 |
1 |
|
312.2 |
|
299.0 |
4 |
5 |
|||||||||
Gross Sales |
$ |
447.4 |
$ |
442.9 |
1 |
% |
1 |
% |
$ |
816.7 |
$ |
791.3 |
3 |
% |
3 |
% |
|||||
1 |
Amounts may not foot due to rounding. |
|||||||||||||||||||
2 |
Sales Adjustments are not allocated to individual products. As such, Net Sales are not presented on a categories or brand level. |
|||||||||||||||||||
3 |
Mattel modified its reporting structure for revenues in the first quarter of 2019 to disclose revenues by categories. Refer to Note 23, Segment Information, in the Form 10-Q for additional information. |
MATTEL, INC. AND SUBSIDIARIES |
EXHIBIT V |
||||||||||||||||||||
GROSS SALES BY SEGMENT (Unaudited)1 | |||||||||||||||||||||
RECONCILIATION OF GAAP AND NON-GAAP FINANCIAL MEASURES | |||||||||||||||||||||
For the Three Months Ended June 30, |
|
For the Six Months Ended June 30, |
|||||||||||||||||||
(In millions, except percentage information) |
2019 |
|
2018 |
|
% Change |
|
% Change in |
|
2019 |
|
2018 |
|
% Change |
|
% Change in |
||||||
Total International Segment Gross Sales: | |||||||||||||||||||||
Net Sales |
$ |
403.6 |
$ |
384.8 |
5 |
% |
11 |
% |
$ |
707.1 |
$ |
702.0 |
1 |
% |
8 |
% |
|||||
Sales Adjustments2 |
|
76.9 |
|
81.9 |
|
138.6 |
|
148.8 |
|||||||||||||
Gross Sales |
$ |
480.5 |
$ |
466.7 |
3 |
% |
9 |
% |
$ |
845.7 |
$ |
850.8 |
-1 |
% |
7 |
% |
|||||
International Segment Gross Sales: | |||||||||||||||||||||
EMEA3 | |||||||||||||||||||||
Net Sales |
$ |
191.1 |
$ |
180.0 |
6 |
% |
13 |
% |
$ |
365.6 |
$ |
365.8 |
0 |
% |
8 |
% |
|||||
Sales Adjustments2 |
|
43.0 |
|
39.6 |
|
84.9 |
|
83.2 |
|||||||||||||
Gross Sales |
$ |
234.1 |
$ |
219.5 |
7 |
% |
13 |
% |
$ |
450.5 |
$ |
449.1 |
0 |
% |
9 |
% |
|||||
Latin America | |||||||||||||||||||||
Net Sales |
$ |
121.2 |
$ |
116.8 |
4 |
% |
9 |
% |
$ |
185.7 |
$ |
180.2 |
3 |
% |
9 |
% |
|||||
Sales Adjustments2 |
|
20.1 |
|
21.7 |
|
30.9 |
|
32.8 |
|||||||||||||
Gross Sales |
$ |
141.3 |
$ |
138.6 |
2 |
% |
7 |
% |
$ |
216.6 |
$ |
213.0 |
2 |
% |
8 |
% |
|||||
Asia Pacific3 | |||||||||||||||||||||
Net Sales |
$ |
91.3 |
$ |
88.0 |
4 |
% |
9 |
% |
$ |
155.8 |
$ |
156.0 |
0 |
% |
5 |
% |
|||||
Sales Adjustments2 |
|
13.7 |
|
20.6 |
|
22.9 |
|
32.7 |
|||||||||||||
Gross Sales |
$ |
105.1 |
$ |
108.6 |
-3 |
% |
2 |
% |
$ |
178.7 |
$ |
188.7 |
-5 |
% |
0 |
% |
|||||
International Gross Sales by Categories:4 | |||||||||||||||||||||
Dolls |
$ |
145.7 |
$ |
138.1 |
6 |
% |
12 |
% |
$ |
272.8 |
$ |
258.8 |
5 |
% |
14 |
% |
|||||
Infant, Toddler and Preschool |
|
109.4 |
|
126.7 |
-14 |
-9 |
|
195.0 |
|
234.6 |
-17 |
-12 |
|||||||||
Vehicles |
|
125.5 |
|
122.9 |
2 |
9 |
|
223.9 |
|
228.6 |
-2 |
6 |
|||||||||
Action Figures, Building Sets and Games |
|
99.9 |
|
79.1 |
26 |
31 |
|
154.0 |
|
128.9 |
19 |
26 |
|||||||||
Gross Sales |
$ |
480.5 |
$ |
466.7 |
3 |
% |
9 |
% |
$ |
845.7 |
$ |
850.8 |
-1 |
% |
7 |
% |
|||||
Supplemental Gross Sales Disclosures | |||||||||||||||||||||
International Gross Sales by Top 3 Power Brands: | |||||||||||||||||||||
Barbie |
$ |
108.1 |
$ |
101.6 |
6 |
% |
13 |
% |
$ |
202.3 |
$ |
193.8 |
4 |
% |
13 |
% |
|||||
Hot Wheels |
|
106.6 |
|
96.5 |
10 |
18 |
|
190.1 |
|
178.0 |
7 |
16 |
|||||||||
Fisher-Price and Thomas & Friends |
|
97.8 |
|
107.7 |
-9 |
-5 |
|
173.6 |
|
195.6 |
-11 |
-6 |
|||||||||
Other |
|
168.1 |
|
160.9 |
4 |
9 |
|
279.7 |
|
283.4 |
-1 |
5 |
|||||||||
Gross Sales |
$ |
480.5 |
$ |
466.7 |
3 |
% |
9 |
% |
$ |
845.7 |
$ |
850.8 |
-1 |
% |
7 |
% |
|||||
1 |
Amounts may not foot due to rounding. |
|||||||||||||||||||||
2 |
Sales Adjustments are not allocated to individual products. As such, Net Sales are not presented on a categories or brand level. |
|||||||||||||||||||||
3 |
Mattel reorganized its regional sales reporting structure in the first quarter of 2019. As a result, the new regions are Europe, the Middle East, and Africa (“EMEA”), Latin America, and Asia Pacific. The Middle East, Africa, Russia, and Turkey were previously included in the Asia Pacific region (previously Global Emerging Markets) and are now included in EMEA (previously Europe). Prior period amounts have been reclassified to conform to the current period presentation. | |||||||||||||||||||||
4 |
Mattel modified its reporting structure for revenues in the first quarter of 2019 to disclose revenues by categories. Refer to Note 23, Segment Information, in the Form 10-Q for additional information. |
MATTEL, INC. AND SUBSIDIARIES | EXHIBIT VI | |||||||||||||||||||||
GROSS SALES BY SEGMENT (Unaudited)1 | ||||||||||||||||||||||
RECONCILIATION OF GAAP AND NON-GAAP FINANCIAL MEASURES | ||||||||||||||||||||||
For the Three Months Ended June 30, |
|
For the Six Months Ended June 30, |
||||||||||||||||||||
(In millions, except percentage information) |
2019 |
|
2018 |
|
% Change |
|
% Change in |
|
2019 |
|
2018 |
|
% Change |
|
% Change in |
|||||||
American Girl Segment Gross Sales: | ||||||||||||||||||||||
Net Sales |
$ |
33.5 |
$ |
43.2 |
-22 |
% |
-22 |
% |
$ |
78.0 |
$ |
108.2 |
-28 |
% |
-28 |
% |
||||||
Sales Adjustments |
|
0.9 |
|
1.4 |
|
2.0 |
|
3.9 |
||||||||||||||
Gross Sales |
$ |
34.4 |
$ |
44.6 |
-23 |
% |
-23 |
% |
$ |
80.0 |
$ |
112.0 |
-29 |
% |
-28 |
% |
||||||
1 Amounts may not foot due to rounding. |
MATTEL, INC. AND SUBSIDIARIES | EXHIBIT VII | |||||||||||
SUPPLEMENTAL FINANCIAL INFORMATION (Unaudited)1 | ||||||||||||
RECONCILIATION OF GAAP AND NON-GAAP FINANCIAL MEASURES | ||||||||||||
For the Three Months Ended June 30, |
|
For the Six Months Ended June 30, |
||||||||||
(In millions, except per share and percentage information) |
20192 |
|
20182 |
|
20192 |
|
20182 |
|||||
Gross Profit | ||||||||||||
Gross Profit, As Reported |
$ |
341.4 |
|
$ |
253.2 |
|
$ |
581.2 |
|
$ |
472.1 |
|
Gross Margin |
39.7 |
% |
30.1 |
% |
37.5 |
% |
30.5 |
% |
||||
Adjustments: | ||||||||||||
Asset Impairments |
- |
|
2.8 |
|
- |
|
5.8 |
|
||||
Severance and Restructuring Expenses3 |
3.5 |
|
- |
|
3.5 |
|
- |
|
||||
Inclined Sleeper Product Recalls4 |
(1.3 |
) |
- |
|
20.6 |
|
- |
|
||||
Gross Profit, As Adjusted |
$ |
343.5 |
|
$ |
256.0 |
|
$ |
605.2 |
|
$ |
477.9 |
|
Adjusted Gross Margin |
39.9 |
% |
30.4 |
% |
39.1 |
% |
30.8 |
% |
||||
Other Selling and Administrative Expenses | ||||||||||||
Other Selling and Administrative Expenses, As Reported |
$ |
308.3 |
|
$ |
360.0 |
|
$ |
609.6 |
|
$ |
784.6 |
|
% of Net Sales |
35.8 |
% |
42.8 |
% |
39.3 |
% |
50.6 |
% |
||||
Adjustments: | ||||||||||||
Asset Impairments |
- |
|
(4.3 |
) |
- |
|
(6.1 |
) |
||||
Non-recurring Executive Compensation |
- |
|
- |
|
- |
|
(1.0 |
) |
||||
Severance and Restructuring Expenses3 |
(14.4 |
) |
(47.8 |
) |
(23.1 |
) |
(72.7 |
) |
||||
Inclined Sleeper Product Recalls4 |
(4.4 |
) |
- |
|
(4.4 |
) |
- |
|
||||
Sale of Assets |
- |
|
- |
|
- |
|
1.4 |
|
||||
Other Selling and Administrative Expenses, As Adjusted |
$ |
289.5 |
|
$ |
307.9 |
|
$ |
582.1 |
|
$ |
706.2 |
|
% of Net Sales |
33.7 |
% |
36.6 |
% |
37.6 |
% |
45.6 |
% |
||||
Operating Loss | ||||||||||||
Operating Loss, As Reported |
$ |
(51.4 |
) |
$ |
(189.2 |
) |
$ |
(182.4 |
) |
$ |
(465.8 |
) |
Adjustments: | ||||||||||||
Asset Impairments |
- |
|
7.1 |
|
- |
|
11.9 |
|
||||
Non-recurring Executive Compensation |
- |
|
- |
|
- |
|
1.0 |
|
||||
Severance and Restructuring Expenses3 |
17.9 |
|
47.8 |
|
26.6 |
|
72.7 |
|
||||
Inclined Sleeper Product Recalls4 |
3.1 |
|
- |
|
25.0 |
|
- |
|
||||
Sale of Assets |
- |
|
- |
|
- |
|
(1.4 |
) |
||||
Operating Loss, As Adjusted |
$ |
(30.4 |
) |
$ |
(134.3 |
) |
$ |
(130.8 |
) |
$ |
(381.6 |
) |
Other Information | ||||||||||||
Toys “R” Us Net Sales Reversal5 |
$ |
- |
|
$ |
- |
|
$ |
- |
|
$ |
29.5 |
|
Toys “R” Us Bad Debt Expense, Net5 |
$ |
- |
|
$ |
(7.0 |
) |
$ |
- |
|
$ |
50.3 |
|
Inclined Sleeper Product Recalls4 |
$ |
3.1 |
|
$ |
- |
|
$ |
30.4 |
|
$ |
- |
|
1 |
Amounts may not foot due to rounding. |
||||||||||||
2 |
Toys “R” Us Net Sales Reversal and Toys “R” Us Bad Debt Expense, Net are not presented as non-GAAP adjustments for the three and six months ended June 30, 2019 and 2018. | ||||||||||||
3 |
For the three and six months ended June 30, 2019, severance and restructuring expenses include $11.5 million related to Capital Light initiatives of which $3.5 million was recorded to Cost of Sales and $8.0 million was recorded to Other Selling and Administrative Expenses. | ||||||||||||
4 |
Mattel recorded an estimated impact of $3.1 million and $30.4 million related to inclined sleeper product recalls for the three and six months ended June 30, 2019, respectively. Of the $30.4 million recorded during the six months ended June 30, 2019, $5.4 million was a reduction to Net Sales for estimated retailer returns. | ||||||||||||
5 |
As a result of the Toys “R” Us liquidation, Mattel reversed Net Sales for the estimated uncollectible portion of its outstanding receivables originating from first quarter 2018 sales. As such, Gross Profit, As Reported includes the Cost of Sales for the inventory sold to Toys “R” Us but excludes the corresponding Net Sales. Additionally, during 2018, Mattel recorded Bad Debt Expense, Net for the estimated uncollectible portion of its outstanding receivables, net of recoveries and other reductions. |
MATTEL, INC. AND SUBSIDIARIES |
EXHIBIT VII |
|||||||||||
SUPPLEMENTAL FINANCIAL INFORMATION (Unaudited)1 | ||||||||||||
RECONCILIATION OF GAAP AND NON-GAAP FINANCIAL MEASURES | ||||||||||||
For the Three Months Ended June 30, |
|
For the Six Months Ended June 30, |
||||||||||
(In millions, except per share and percentage information) |
20192 |
|
|
20182 |
|
|
20192 |
|
20182 |
|
||
Earnings Per Share | ||||||||||||
Net Loss Per Common Share, As Reported |
$ |
(0.31 |
) |
$ |
(0.70 |
) |
$ |
(0.84 |
) |
$ |
(1.60 |
) |
Adjustments: | ||||||||||||
Asset Impairments |
- |
|
0.02 |
|
- |
|
0.03 |
|
||||
Severance and Restructuring Expenses3 |
0.05 |
|
0.14 |
|
0.08 |
|
0.21 |
|
||||
Inclined Sleeper Product Recalls4 |
0.01 |
|
- |
|
0.07 |
|
- |
|
||||
Tax Effect of Adjustments6 |
- |
|
- |
|
- |
|
(0.03 |
) |
||||
Net Loss Per Common Share, As Adjusted |
$ |
(0.25 |
) |
$ |
(0.54 |
) |
$ |
(0.69 |
) |
$ |
(1.39 |
) |
EBITDA and Adjusted EBITDA | ||||||||||||
Net Loss, As Reported |
$ |
(108.0 |
) |
$ |
(240.9 |
) |
$ |
(291.7 |
) |
$ |
(552.2 |
) |
Adjustments: | ||||||||||||
Interest Expense |
46.2 |
|
43.5 |
|
93.2 |
|
84.5 |
|
||||
Provision for Income Taxes |
12.2 |
|
6.9 |
|
18.3 |
|
4.3 |
|
||||
Depreciation |
51.5 |
|
58.9 |
|
103.6 |
|
117.4 |
|
||||
Amortization |
9.9 |
|
9.5 |
|
20.3 |
|
19.7 |
|
||||
EBITDA |
11.8 |
|
(122.1 |
) |
(56.3 |
) |
(326.2 |
) |
||||
Adjustments: | ||||||||||||
Asset Impairments |
- |
|
7.1 |
|
- |
|
11.9 |
|
||||
Shared-based Compensation |
12.4 |
|
8.0 |
|
24.3 |
|
22.4 |
|
||||
Severance and Restructuring Expenses3 |
14.5 |
|
47.8 |
|
23.2 |
|
72.7 |
|
||||
Inclined Sleeper Product Recalls4 |
3.1 |
|
- |
|
25.0 |
|
- |
|
||||
Sale of Assets |
- |
|
- |
|
- |
|
(1.4 |
) |
||||
Adjusted EBITDA |
$ |
41.8 |
|
$ |
(59.2 |
) |
$ |
16.2 |
|
$ |
(220.6 |
) |
1 |
Amounts may not foot due to rounding. |
2 |
Toys “R” Us Net Sales Reversal and Toys “R” Us Bad Debt Expense, Net are not presented as non-GAAP adjustments for the three and six months ended June 30, 2019 and 2018. |
3 |
For the three and six months ended June 30, 2019, severance and restructuring expenses include $11.5 million related to Capital Light initiatives of which $3.5 million was recorded to Cost of Sales and $8.0 million was recorded to Other Selling and Administrative Expenses. |
4 |
Mattel recorded an estimated impact of $3.1 million and $30.4 million related to inclined sleeper product recalls for the three and six months ended June 30, 2019, respectively. Of the $30.4 million recorded during the six months ended June 30, 2019, $5.4 million was a reduction to Net Sales for estimated retailer returns. |
6 |
The aggregate tax effect of the adjustments is calculated by tax effecting the adjustments by the current effective tax rate, and dividing by the reported weighted average number of common and potential common shares. Adjustments for the U.S. and certain International affiliates were not tax effected because of the valuation allowance on deferred tax assets. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20190725005819/en/
Source:
News Media
Dena Cook
dena.cook@mattel.com
310-252-4247
Securities Analysts
David Zbojniewicz
david.zbojniewicz@mattel.com
310-252-2703
Media Contact
Mattel Newsroom
Email : press@mattel.com