(Adds quote from chief executive in fourth paragraph and
information about domestic and international sales and share
buyback activity)
Mattel Inc.'s (MAT) first-quarter earnings fell 33% as expenses
rose, offsetting a bigger-than-expected jump in sales. Its Barbie
division continued to see strength, though Fisher-Price brand sales
declined slightly.
The largest U.S. toy maker by revenue has benefited from sales
of merchandise tied to the film "Toy Story 3," and resilience in
its iconic Barbie dolls, along with cost-cutting efforts. However,
its Fisher-Price division and Hot Wheels and Matchbox car
categories have lagged.
Mattel reported a profit of $16.6 million, or 5 cents a share,
down from $24.8 million, or 7 cents a share, a year earlier. Sales
jumped 8.2% to $951.9 million. Analysts polled by Thomson Reuters
had most recently forecast earnings of 5 cents on revenue of $904
million.
The company's "diverse portfolio of brands and
countries...allowed us to deliver on our goal of consistent
growth," Chief Executive Robert Eckert said. "Additionally, we are
well positioned to improve operating margin and deliver strong cash
flow for the year." Eckert did not provide an outlook.
Sales of Mattel's girls and boy brands unit--its biggest arm and
the one that includes Barbie and Hot Wheels--grew 15% as Barbie
sales rose 14%, and Hot Wheels sales were up 6%. Sales of
Fisher-Price brands decreased 2% with the discontinuation of the
Sesame Street product line, while its American Girl brands
increased 4% on strong sales of Kanani, Girl of the Year 2011.
Domestic sales rose 7% and international sales grew 10%. Gross
margin rose to 49.7% from 49.1%. Advertising and promotion expenses
climbed 8.1%, while selling and administrative expenses were up
14%.
Mattel said it bought back four million shares during the
quarter for about $100 million.
Rival toy maker Hasbro Inc. (HAS) on Thursday reported its
first-quarter earnings fell 71%, missing analysts' estimates, as it
spent more on product development and saw double-digit sales
declines in its games and puzzles, girls and preschool
categories.
Mattel shares closed at $25.74 Thursday and were inactive
premarket. As of the close, the stock had risen 8.4% over the past
year.
-By Melodie Warner, Dow Jones Newswires; 212-416-2283;
melodie.warner@dowjones.com
--Karen Talley contributed to this article