) third-quarter 2013 earnings of $1.16 per share beat the Zacks
Consensus Estimate of $1.10 by 5.5% and were 11.5% higher than
the year-ago earnings of $1.04. Earnings in the quarter were
driven by higher top line and margin expansion.
During the quarter, net sales increased 6.2% year over year to
$2.21 billion and were also ahead of the Zacks Consensus Estimate
of $2.16 billion by 2.3%. Higher international as well as
domestic sales boosted the top line during the quarter. Quarterly
net sales included an unfavorable foreign currency impact of 1
Gross sales from North America (including the U.S., Canada and
American Girl) increased 3% year over year. International gross
sales also went up by 9.0% year over year.
Mattel's product segments comprise Mattel Girls & Boys
Brands, Fisher-Price Brands and American Girl Brands.
Worldwide gross sales at
Mattel Girls & Boys
increased 8% year over year to $1.48 billion. Other Girls Brands
sales shot up 28% buoyed by the higher demand in the Monster High
brand. Barbie sales increased 3%. Entertainment business'
worldwide gross sales were up 7% gaining from the higher sales of
movie. However, the Wheels category's sales declined 9% due to
lower sales of Tyco R/C and Matchbox products.
, which includes Fisher-Price Core, Fisher-Price Friends and
Power Wheels brands, remained flat year over year at $789.3
American Girl Brands
leaped 20% to $122.3 million, primarily led by Saige, 2013 Girl
of the Year, American Girl, Bitty Baby and Historical dolls
Gross margin was up 10 basis points (bps) to 53.8%, driven by
increased top line offsetting higher cost of sales. Operating
margin increased 40 bps to 23.9%.
Share Buyback Activity & Dividend
During the third quarter, Mattel repurchased 6.1 million
shares worth $259 million. The company has declared that it will
pay its fourth-quarter dividend of 36 cents per share on Dec 13,
2013, to shareholders of record at the close of business on Nov
27, 2013. In 2013, the company's annual dividend is $1.44 per
share, up 16% from the prior year's dividend.
The better-than-expected third-quarter results of Mattel
reinforce faith on the stock. Sales at the company's Barbie brand
also increased during the quarter.
However, tough retail environment amid a tepid economy and the
stiff competition are causes of concern. Continued weak
performance of the Zacks Rank #4 (Sell) company's Fisher-Price
brand also added to the woes.
Other toy makers such as,
Jakks Pacific Inc.
LeapFrog Enterprises Inc.
), are slated to report quarterly earnings soon. While Hasbro
will report on Oct 21, Jakks Pacific and LeapFrog will likely
report on Oct 23 and Nov 4, respectively.
HASBRO INC (HAS): Free Stock Analysis Report
JAKKS PACIFIC (JAKK): Free Stock Analysis
LEAPFROG ENTRPS (LF): Free Stock Analysis
MATTEL INC (MAT): Free Stock Analysis Report
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