EL SEGUNDO, Calif.,
Oct. 25, 2018 /PRNewswire/
-- Mattel, Inc. (NASDAQ: MAT) today reported third quarter
2018 financial results.
Ynon Kreiz, Chairman and CEO of Mattel, said: "We are on track
with the execution of our strategy and have made meaningful
progress towards restoring profitability, as we transform Mattel
into an IP-driven, high-performing toy company. In the quarter, we
achieved Operating Income of $122
million, up 41% versus the same period last year, which is
the first time in eight quarters that we have posted year-over-year
growth."
"We are proud to say that we recaptured our position as the
number one toy company globally in each of the last four months
through September, according to NPD. We were also the number one
toy company in the U.S. and Latin
America year-to-date through September. We continued to make
progress in reshaping our organization and are actively exploring
strategic alternatives for our manufacturing footprint as we move
toward a capital-light model. Additionally, we have taken
meaningful steps to drive future growth and capitalize on our
iconic brands and IP. This includes the creation of a new
theatrical film division and a global franchise management
organization."
Joseph Euteneuer, CFO of Mattel,
added: "We continue to be on-track to achieve or exceed our
$650 million targeted run-rate cost
savings exiting 2019 and are clearly seeing the benefits of
Structural Simplification materializing in the P&L. The actions
taken through the third quarter resulted in approximately
$120 million of savings and we expect
to deliver annual run-rate savings of over $500 million exiting 2018. We remain focused on
value creation for our shareholders through our comprehensive
actions to restore profitability and regain topline growth."
For the third quarter of 2018, Net Sales were down 8% as
reported and 6% in constant currency, versus the prior year's third
quarter. Gross Sales were down 6% as reported and 4% in constant
currency, reflecting a negative 3% impact from the Toys "R" Us™
liquidation and a negative 3% impact from the slowdown in our
China business. Reported Operating
Income was $122 million up 41%, and
Adjusted Operating Income was $153
million up 31%. Reported Earnings Per Share was $0.02 and Adjusted Earnings Per Share was
$0.18.
Financial Overview
Net Sales in the North America
segment increased by 4% as reported, versus the prior year's third
quarter. Gross Sales in the North
America segment increased by 6% as reported, primarily
driven by strong sales of Barbie, despite a 4% impact from Toys "R"
Us.
In the International segment, Net Sales decreased by 18% as
reported and 14% in constant currency, versus the prior year's
third quarter. Gross Sales in the International segment decreased
by 16% as reported and 11% in constant currency, primarily driven
by lower sales of Fisher-Price™ and Thomas & Friends™ and
CARS™, partially offset by initial sales of Jurassic World™. By
region, the decrease in Gross Sales as reported was driven by lower
sales in Global Emerging Markets, predominantly in China, and Europe.
Net Sales for the American Girl® segment decreased by 32% as
reported, versus the prior year's third quarter. Gross Sales for
the American Girl segment decreased by 32% as reported, due to
lower sales in proprietary retail and direct channels, and a
strategic shift away from the utilization of external distribution
channels.
Reported Gross Margin improved from 41.5% in 2017 to 42.6% in
2018, primarily driven by Structural Simplification savings, a
benefit related to the prior year Toys "R" Us sales reversal and
favorable logistics costs, partially offset by input cost
inflation. Other selling and administrative expenses decreased by
$55.0 million as reported, and by
$50.0 million as adjusted, primarily
driven by Structural Simplification program savings.
For the nine months ended September 30,
2018, net Cash Flows Used For Operating Activities were
approximately $731 million, a
decrease of $9 million as compared to
the prior period, primarily driven by lower working capital usage
offset by a higher net loss, excluding the impact of non-cash
charges. Cash Flows Used For Investing Activities were
approximately $115 million, a
decrease of approximately $60 million
as compared to the prior period, primarily driven by lower capital
spending, partially offset by changes in foreign currency forward
exchange contracts. Cash Flows Used For Financing Activities and
Other were approximately $24 million,
as compared to Cash Flows Provided by Financing Activities and
Other of approximately $227 million
in the prior period, primarily driven by lower net proceeds from
borrowings of $540 million, partially
offset by $312 million of dividend
payments during the nine months ended September 30, 2017.
Sales by Brand
Power Brands
For the third quarter, Gross Sales for Mattel Power Brands were $1.08 billion, down 5% as reported and 2% in
constant currency, versus the prior year's third quarter. Gross
Sales for the Barbie brand were up 14% as reported and 17% in
constant currency, primarily driven by positive POS brand momentum.
Gross Sales for the Hot Wheels brand were down 6% as reported and
3% in constant currency compared to 2017, which benefited from
sales in advance of the theatrical release of Star Wars and a Toys
"R" Us exclusive product offering. Gross Sales for the Fisher-Price
and Thomas & Friends brands were down 12% as reported and 10%
in constant currency, primarily driven by lower sales of
Fisher-Price infant and Thomas & Friends products. Gross Sales
for the American Girl brand were down 31% as reported, due to lower
sales in proprietary retail and direct channels, and a strategic
shift in external distribution channels.
Toy Box
For the third quarter, Gross Sales for Mattel Toy Box brands, which
includes Owned Brands and Partner Brands, were $523.2 million, down 9% as reported and 6% in
constant currency, versus the prior year's third quarter. Gross
Sales for Owned Brands were down 1% as reported, and up 2% in
constant currency, primarily driven by higher sales of Polly
Pocket™ and Games. Gross Sales for Partner Brands were down 17% as
reported and 15% in constant currency compared to 2017, which
benefited from the theatrical release of Cars 3™, partially offset
by initial sales of Jurassic World™ in 2018.
Conference Call and Live
Webcast
At 5:00 p.m. (Eastern Time) today,
Mattel will host a conference call with investors and financial
analysts to discuss its 2018 third quarter financial results. The
conference call will be webcast on Mattel's Investor
Relations website, http://investor.shareholder.com/mattel. To
listen to the live call, log on to the website at least 10 minutes
early to register, download and install any necessary audio
software. An archive of the webcast will be available on
Mattel's Investor Relations website for 90 days and may be
accessed beginning approximately two hours after the completion of
the live call. A telephonic replay of the call will be available
beginning at 8:30 p.m. Eastern time the evening of the
call until Thursday, November 1, 2018, and may be accessed by
dialing +1-404-537-3406. The passcode is 3187885.
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
Mattel may experience in implementing cost savings and efficiency
enhancing initiatives; (v) other economic and public health
conditions or regulatory changes in the markets in which Mattel and
its customers and suppliers operate, which could create delays or
increase Mattel's costs, such as higher commodity prices, labor
costs or transportation costs, or outbreaks of disease; (vi)
currency fluctuations, including movements in foreign exchange
rates, which can lower Mattel's net revenues and earnings, and
significantly impact Mattel's costs; (vii) the concentration of
Mattel's customers, potentially increasing the negative impact to
Mattel of difficulties experienced by any of Mattel's customers,
including the bankruptcy of Toys "R" Us, Inc., or changes in their
purchasing or selling patterns; (viii) the future willingness of
licensors of entertainment properties for which Mattel currently
has licenses or would seek to have licenses in the future to
license those products to Mattel; (ix) the inventory policies of
Mattel's retail customers, including retailers' potential decisions
to lower their inventories, even if it results in lost sales, as
well as the concentration of Mattel's revenues in the second half
of the year, which coupled with reliance by retailers on quick
response inventory management techniques increases the risk of
underproduction of popular items, overproduction of less popular
items and failure to achieve compressed shipping schedules; (x) the
increased costs of developing more sophisticated digital and smart
technology products, and the corresponding supply chain and design
challenges associated with such products; (xi) work disruptions,
which may impact Mattel's ability to manufacture or deliver product
in a timely and cost-effective manner; (xii) the bankruptcy of Toys
"R" Us, Inc. or other of Mattel's significant retailers, or the
general lack of success of one of Mattel's significant retailers
which could negatively impact Mattel's revenues or bad debt
exposure; (xiii) the impact of competition on revenues, margins and
other aspects of Mattel's business, including the ability to offer
products which consumers choose to buy instead of competitor's
products, the ability to secure, maintain and renew popular
licenses and the ability to attract and retain talented
employees; (xiv) the risk of product recalls or product
liability suits and costs associated with product safety
regulations; (xv) changes in laws or regulations in the United States and/or in other major
markets, such as China, in which
Mattel operates, including, without limitation, with respect to
taxes, tariffs, trade policies or product safety, which may
increase Mattel's product costs and other costs of doing business,
and reduce Mattel's earnings, (xvi) failure to realize the planned
benefits from any investments or acquisitions made by Mattel,
(xvii) the impact of other market conditions, third party actions
or approvals and competition which could reduce demand for Mattel's
products or delay or increase the cost of implementation of
Mattel's initiatives or alter Mattel's actions and reduce actual
results; (xviii) changes in financing markets or the inability of
Mattel to obtain financing on attractive terms (xix) the impact of
litigation or arbitration decisions or settlement actions; and (xx)
other risks and uncertainties as may be described in Mattel's
periodic filings with the Securities and Exchange Commission,
including the "Risk Factors" section of Mattel's Annual Report on
Form 10-K for the fiscal year ended December
31, 2017. Mattel does not update forward-looking statements
and expressly disclaims any obligation to do so.
Non-GAAP Financial Measures
To supplement our financial results presented in accordance with
generally accepted accounting principles in the United States ("GAAP"), Mattel presents
certain non-GAAP financial measures within the meaning of
Regulation G promulgated by the Securities and Exchange Commission.
The non-GAAP financial measures that Mattel uses in this earnings
release include gross sales, adjusted gross profit, adjusted gross
margin, adjusted other selling and administrative expenses,
adjusted operating income (loss), adjusted earnings (loss) per
share, earnings before interest expense, taxes, depreciation and
amortization ("EBITDA"), adjusted EBITDA, and constant currency.
Mattel uses these metrics to analyze its continuing operations and
to monitor, assess and identify meaningful trends in its operating
and financial performance, and each is discussed in detail below.
Mattel believes that the disclosure of non-GAAP financial measures
provides useful supplemental information to investors to be able to
better evaluate ongoing business performance and certain components
of the Company's results. These measures are not, and should not be
viewed as, substitutes for GAAP financial measures. Reconciliations
of the non-GAAP financial measures to the most directly comparable
GAAP financial measures are attached to this earnings release as
exhibits and to our earnings slide presentation as an appendix.
This earnings release and our earnings slide presentation are
available on Mattel's Investor Relations
website, http://investor.shareholder.com/mattel, under the
subheading "Financial Information – Earnings Releases."
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.
Mattel presents changes in gross sales as a metric for comparing
its aggregate, brand and geographic results to highlight
significant trends in Mattel's business. Changes in gross sales are
discussed because, while Mattel records the details of such sales
adjustments in its financial accounting systems at the time of
sale, such sales adjustments are generally not associated with
brands and individual products, making net sales less meaningful.
Since sales adjustments are determined by customer rather than at
the brand level, Mattel believes that the disclosure of gross sales
by brand is useful supplemental information for investors to be
able to assess the performance of its underlying brands (e.g.,
Barbie) and also enhances their ability to compare sales trends
over time.
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 and severance and
restructuring expenses. 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 Mattel believes is useful
supplemental information for investors to be able to gauge and
compare Mattel's current business performance from one period to
another.
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, 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 Mattel believes is
useful supplemental information for investors to be able to gauge
and compare Mattel's current business performance from one period
to another.
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, and sale of assets, 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 Mattel believes is useful
supplemental information for investors to be able to gauge and
compare Mattel's current business performance from one period to
another.
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, non-recurring executive compensation,
severance and restructuring expenses, sale of assets, 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 also excludes the
impact of the provisional tax for deemed repatriation of
accumulated foreign earnings, changes to Mattel's indefinite
reinvestment assertion as a result of U.S. Tax Reform, and the
impact of the valuation allowance established for the portion of
deferred tax assets Mattel believes will likely not be realized.
Adjusted earnings (loss) per share is presented to provide
additional perspective on underlying trends in Mattel's core
business. Mattel believes it is useful supplemental information for
investors to gauge and compare Mattel's current earnings results
from one period to another. Adjusted earnings (loss) per share is a
performance measure and should not be used as a measure of
liquidity.
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, and sale of assets, which are
not part of Mattel's core business. Mattel believes EBITDA and
Adjusted EBITDA are useful supplemental information for investors
to gauge and compare Mattel's business performance to other
companies in our industry with similar capital structures. The
presentation of Adjusted EBITDA differs from how we will calculate
EBITDA for purposes of covenant compliance under the indenture
governing our 6.75% senior notes due 2025 and the syndicated
facility agreement governing our senior secured revolving credit
facilities. Because of these limitations, EBITDA and Adjusted
EBITDA should not be considered as measures of discretionary cash
available to us to invest in the growth of our business. As a
result, we rely primarily on our GAAP results and use EBITDA and
Adjusted EBITDA only supplementally.
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, Mattel calculates constant
currency information by translating current period and prior period
results for entities reporting in currencies other than the US
dollar using consistent exchange rates. The constant currency
exchange rates are determined by Mattel at the beginning of each
year and are applied consistently during the year. They are
generally different from the actual exchange rates in effect during
the current or prior period due to volatility in actual foreign
exchange rates. Mattel considers whether any changes to the
constant currency rates are appropriate at the beginning of each
year. The exchange rates used for these constant currency
calculations are generally based on prior year actual exchange
rates. The difference between the current period and prior period
results using the consistent exchange rates reflects the changes in
the underlying performance results, excluding the impact from
changes in currency exchange rates. Mattel analyzes constant
currency results to provide additional perspective on changes in
underlying trends in Mattel's operating performance. Mattel
believes that the disclosure of the percentage change in constant
currency is useful supplemental information for investors to be
able to gauge Mattel's current business performance and the
longer-term strength of its overall business since foreign currency
changes could potentially mask underlying sales trends. The
disclosure of the percentage change in constant currency enhances
investor's ability to compare financial results from one period to
another.
About Mattel
Mattel is a leading global children's entertainment company that
specializes in design and production of quality toys and consumer
products. We create innovative products and experiences that
inspire, entertain and develop children through play. We engage
consumers through our portfolio of iconic franchises, including
Barbie®, Hot Wheels®, American Girl®, Fisher-Price®, Thomas &
Friends® and Mega®, as well as other popular brands that we own or
license in partnership with global entertainment companies. Our
offerings include film and television content, gaming, music and
live events. We operate in 40 locations and sell products in more
than 150 countries in collaboration with the world's leading retail
and technology companies. Since its founding in 1945, Mattel is
proud to be a trusted partner in exploring the wonder of childhood
and empowering kids to reach their full potential. Visit us online
at www.mattel.com.
Contacts:
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News
Media
Mattel Media
Relations
310-252-6397
press@mattel.com
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Securities
Analysts
Whitney
Steininger
310-252-2703
whitney.steininger@mattel.com
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MAT-FIN MAT-CORP
MATTEL, INC. AND
SUBSIDIARIES
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EXHIBIT
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CONSOLIDATED
STATEMENTS OF OPERATIONS (Unaudited)1
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For the Three
Months Ended September 30,
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For the Nine
Months Ended September 30,
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Yr /
Yr
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Yr /
Yr
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Yr /
Yr
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Yr /
Yr
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%
Change
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%
Change
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%
Change
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%
Change
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(In millions,
except per share and
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2018
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20172
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as
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in
Constant
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2018
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20172
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as
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in
Constant
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percentage
information)
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$
Amt
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% Net
Sales
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$
Amt
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% Net
Sales
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Reported
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Currency
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$
Amt
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% Net
Sales
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$
Amt
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% Net
Sales
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Reported
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Currency
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Net
Sales
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$
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1,437.5
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$
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1,561.0
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-8%
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-6%
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$
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2,986.6
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$
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3,271.1
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-9%
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-8%
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Cost of
sales
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824.4
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57.4%
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913.8
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58.5%
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-10%
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1,901.4
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63.7%
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1,945.4
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59.5%
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-2%
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Gross
Profit
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613.1
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42.6%
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647.2
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41.5%
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-5%
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-2%
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1,085.1
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36.3%
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1,325.7
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40.5%
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-18%
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-17%
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Advertising and promotion expenses
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165.3
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11.5%
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179.7
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11.5%
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-8%
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318.5
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10.7%
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348.8
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10.7%
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-9%
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Other
selling and administrative expenses
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325.9
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22.7%
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381.3
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24.4%
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-15%
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1,110.5
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37.2%
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1,065.3
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32.6%
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4%
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Operating Income
(Loss)
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121.9
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8.5%
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86.2
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5.5%
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41%
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55%
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(343.9)
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-11.5%
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(88.4)
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-2.7%
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289%
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260%
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Interest
expense
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48.2
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3.4%
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24.7
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1.6%
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95%
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132.7
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4.4%
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68.6
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2.1%
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94%
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Interest
(income)
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(0.8)
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-0.1%
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(1.5)
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-0.1%
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-50%
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(5.6)
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-0.2%
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(6.3)
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-0.2%
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-11%
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Other
non-operating expense, net
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1.9
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1.8
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4.4
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7.5
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Income (Loss)
Before Income Taxes
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72.6
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5.1%
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61.2
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3.9%
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18%
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39%
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(475.3)
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-15.9%
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(158.2)
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-4.8%
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201%
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189%
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Provision for income taxes
|
|
|
|
66.3
|
|
|
|
664.5
|
|
|
|
|
|
|
|
|
70.6
|
|
|
|
614.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income
(Loss)
|
|
|
|
$
|
6.3
|
|
0.4%
|
$
|
(603.3)
|
|
-38.6%
|
|
-101%
|
|
|
|
$
|
(545.9)
|
|
-18.3%
|
$
|
(772.6)
|
|
-23.6%
|
|
-29%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss)
Per Common Share - Basic
|
$
|
0.02
|
|
|
$
|
(1.75)
|
|
|
|
|
|
|
|
$
|
(1.58)
|
|
|
$
|
(2.25)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of common shares
|
|
|
345.3
|
|
|
|
343.9
|
|
|
|
|
|
|
|
|
344.8
|
|
|
|
343.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss)
Per Common Share - Diluted
|
$
|
0.02
|
|
|
$
|
(1.75)
|
|
|
|
|
|
|
|
$
|
(1.58)
|
|
|
$
|
(2.25)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of common and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
potential
common shares
|
|
|
|
345.7
|
|
|
|
343.9
|
|
|
|
|
|
|
|
|
344.8
|
|
|
|
343.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Amounts
may not foot due to rounding.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2 Other
selling and administrative expenses, operating income (loss), and
other non-operating expense, net have been retrospectively restated
to reflect the adoption of Accounting Standards Update 2017-07,
Improving the Presentation of Net Periodic
|
Pension Cost and Net
Periodic Postretirement Benefit Cost.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MATTEL, INC. AND
SUBSIDIARIES
|
|
|
|
|
|
EXHIBIT
II
|
|
|
|
|
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September
30,
|
|
December
31,
|
|
|
|
|
|
|
2018
|
|
2017
|
|
2017
|
(In
millions)
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
Cash and
equivalents
|
|
|
|
$
|
209.2
|
$
|
181.3
|
$
|
1,079.2
|
Accounts
receivable, net
|
|
|
|
|
1,312.9
|
|
1,506.1
|
|
1,128.6
|
Inventories
|
|
|
|
|
|
726.0
|
|
990.0
|
|
600.7
|
Prepaid
expenses and other current assets
|
|
|
|
287.0
|
|
352.8
|
|
303.1
|
Total current
assets
|
|
|
|
|
2,535.1
|
|
3,030.2
|
|
3,111.6
|
|
|
|
|
|
|
|
|
|
|
|
Property, plant, and equipment, net
|
|
|
|
677.0
|
|
821.2
|
|
785.3
|
Other
noncurrent assets
|
|
|
|
|
2,269.7
|
|
2,348.3
|
|
2,341.6
|
Total
Assets
|
|
|
|
|
$
|
5,481.8
|
$
|
6,199.7
|
$
|
6,238.5
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
|
|
Short-term borrowings
|
|
|
|
$
|
275.0
|
$
|
732.6
|
$
|
-
|
Current
portion of long-term debt
|
|
|
|
-
|
|
250.0
|
|
250.0
|
Accounts
payable and accrued liabilities
|
|
|
1,213.2
|
|
1,282.3
|
|
1,364.3
|
Income
taxes payable
|
|
|
|
|
5.8
|
|
32.4
|
|
9.5
|
Total current
liabilities
|
|
|
|
|
1,494.0
|
|
2,297.3
|
|
1,623.8
|
|
|
|
|
|
|
|
|
|
|
|
Long-term debt
|
|
|
|
|
|
2,849.9
|
|
1,886.4
|
|
2,873.1
|
Other
noncurrent liabilities
|
|
|
|
|
471.5
|
|
576.3
|
|
484.1
|
Stockholders' equity
|
|
|
|
|
666.4
|
|
1,439.7
|
|
1,257.5
|
Total Liabilities
and Stockholders' Equity
|
|
$
|
5,481.8
|
$
|
6,199.7
|
$
|
6,238.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL
BALANCE SHEET AND CASH FLOW DATA
(Unaudited)1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September
30,
|
|
|
(In millions,
except days and percentage information)
|
|
2018
|
|
2017
|
|
|
Key Balance Sheet
Data:
|
|
|
|
|
|
|
|
|
|
Accounts receivable,
net days of sales outstanding (DSO)
|
|
82
|
|
87
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended
September 30,
|
|
|
(In
millions)
|
|
|
|
|
|
2018
|
|
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Condensed Cash
Flow Data:
|
|
|
|
|
|
|
|
|
|
Cash flows (used for)
operating activities
|
|
|
$
|
(731)
|
$
|
(740)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows (used for)
investing activities
|
|
|
|
(115)
|
|
(175)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows (used for)
provided by financing activities and other
|
|
(24)
|
|
227
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Decrease in cash and
equivalents
|
|
|
|
$
|
(870)
|
$
|
(688)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Amounts
may not foot due to rounding.
|
|
|
|
|
|
|
|
|
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 September 30,
|
|
|
For the Nine
Months Ended September 30,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions,
except percentage information)
|
|
2018
|
|
2017
|
|
% Change
as Reported
|
|
% Change in
Constant
Currency
|
|
|
2018
|
|
2017
|
|
% Change
as Reported
|
|
% Change in
Constant
Currency
|
|
|
Worldwide Gross
Sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Sales
|
|
|
|
|
$
1,437.5
|
|
$
1,561.0
|
|
-8
|
%
|
-6
|
%
|
|
$
2,986.6
|
|
$
3,271.1
|
|
-9
|
%
|
-8
|
%
|
|
Sales
Adjustments2
|
|
|
|
169.2
|
|
149.2
|
|
|
|
|
|
|
374.2
|
|
322.2
|
|
|
|
|
|
|
Gross
Sales
|
|
|
|
$
1,606.6
|
|
$
1,710.2
|
|
-6
|
%
|
-4
|
%
|
|
$
3,360.8
|
|
$
3,593.3
|
|
-6
|
%
|
-6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Worldwide Gross
Sales by Brand:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Power
Brands
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Barbie
|
|
|
|
|
$
374.7
|
|
$
329.6
|
|
14
|
%
|
17
|
%
|
|
$
698.1
|
|
$
605.2
|
|
15
|
%
|
16
|
%
|
|
Hot Wheels
|
|
|
|
235.0
|
|
250.0
|
|
-6
|
|
-3
|
|
|
547.2
|
|
514.0
|
|
6
|
|
7
|
|
|
Fisher-Price and
Thomas & Friends
|
|
|
409.5
|
|
463.7
|
|
-12
|
|
-10
|
|
|
833.5
|
|
944.7
|
|
-12
|
|
-12
|
|
|
American
Girl
|
|
|
|
64.3
|
|
93.8
|
|
-31
|
|
-31
|
|
|
176.9
|
|
246.9
|
|
-28
|
|
-28
|
|
|
Total Power
Brands
|
|
|
$
1,083.5
|
|
$
1,137.0
|
|
-5
|
|
-2
|
|
|
$
2,255.7
|
|
$
2,310.8
|
|
-2
|
|
-2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Toy
Box
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owned
Brands
|
|
|
|
$
290.9
|
|
$
294.8
|
|
-1
|
|
2
|
|
|
$
581.5
|
|
$
611.0
|
|
-5
|
|
-5
|
|
|
Partner
Brands
|
|
|
|
232.3
|
|
278.3
|
|
-17
|
|
-15
|
|
|
523.5
|
|
671.5
|
|
-22
|
|
-22
|
|
|
Total Toy
Box
|
|
|
|
$
523.2
|
|
$
573.1
|
|
-9
|
|
-6
|
|
|
$
1,105.0
|
|
$
1,282.6
|
|
-14
|
|
-14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Gross
Sales
|
|
|
|
$
1,606.6
|
|
$
1,710.2
|
|
-6
|
%
|
-4
|
%
|
|
$
3,360.8
|
|
$
3,593.3
|
|
-6
|
%
|
-6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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 brand level.
|
|
|
|
|
|
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 September 30,
|
|
For the Nine
Months Ended September 30,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions,
except percentage information)
|
|
2018
|
|
2017
|
|
% Change
as Reported
|
|
% Change in
Constant Currency
|
|
2018
|
|
2017
|
|
% Change
as Reported
|
|
% Change in
Constant
Currency
|
|
|
North America
Segment Gross Sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Sales
|
|
|
$
825.6
|
|
$
796.1
|
|
4
|
%
|
4
|
%
|
$
1,564.5
|
|
$
1,620.9
|
|
-3
|
%
|
-4
|
%
|
|
Sales
Adjustments2
|
|
60.7
|
|
43.2
|
|
|
|
|
|
113.1
|
|
88.0
|
|
|
|
|
|
|
Gross
Sales
|
|
$
886.3
|
|
$
839.3
|
|
6
|
%
|
6
|
%
|
$
1,677.6
|
|
$
1,708.9
|
|
-2
|
%
|
-2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America
Segment Gross Sales by Brand:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Power
Brands
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Barbie
|
|
|
$
208.8
|
|
$
171.1
|
|
22
|
%
|
22
|
%
|
$
338.4
|
|
$
285.6
|
|
19
|
%
|
19
|
%
|
|
Hot Wheels
|
|
120.7
|
|
116.6
|
|
4
|
|
4
|
|
255.0
|
|
225.6
|
|
13
|
|
13
|
|
|
Fisher-Price and
Thomas & Friends
|
|
255.2
|
|
257.4
|
|
-1
|
|
-1
|
|
483.5
|
|
517.2
|
|
-7
|
|
-7
|
|
|
Total Power
Brands
|
|
$
584.7
|
|
$
545.1
|
|
7
|
|
7
|
|
$
1,077.0
|
|
$
1,028.4
|
|
5
|
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Toy
Box
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owned
Brands
|
|
$
159.6
|
|
$
155.2
|
|
3
|
|
3
|
|
$
296.6
|
|
$
323.4
|
|
-8
|
|
-8
|
|
|
Partner
Brands
|
|
142.0
|
|
139.0
|
|
2
|
|
2
|
|
303.9
|
|
357.1
|
|
-15
|
|
-15
|
|
|
Total Toy
Box
|
|
$
301.6
|
|
$
294.2
|
|
3
|
|
3
|
|
$
600.6
|
|
$
680.5
|
|
-12
|
|
-12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Gross
Sales
|
|
$
886.3
|
|
$
839.3
|
|
6
|
%
|
6
|
%
|
$
1,677.6
|
|
$
1,708.9
|
|
-2
|
%
|
-2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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 brand level.
|
|
|
|
|
|
|
|
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 September 30,
|
|
|
For the Nine
Months Ended September 30,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions,
except percentage information)
|
2018
|
|
2017
|
|
% Change
as Reported
|
|
% Change in
Constant
Currency
|
|
|
2018
|
|
2017
|
|
% Change
as Reported
|
|
% Change in
Constant
Currency
|
|
|
Total
International Segment Gross Sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Sales
|
|
|
$
551.1
|
|
$
675.2
|
|
-18
|
%
|
-14
|
%
|
|
$
1,253.1
|
|
$
1,415.4
|
|
-11
|
%
|
-11
|
%
|
|
Sales
Adjustments
|
|
105.4
|
|
101.8
|
|
|
|
|
|
|
254.2
|
|
221.6
|
|
|
|
|
|
|
Gross
Sales
|
|
$
656.5
|
|
$
777.0
|
|
-16
|
%
|
-11
|
%
|
|
$
1,507.3
|
|
$
1,637.0
|
|
-8
|
%
|
-7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International
Segment Gross Sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Sales
|
|
|
$
262.3
|
|
$
306.3
|
|
-14
|
%
|
-13
|
%
|
|
$
539.4
|
|
$
590.5
|
|
-9
|
%
|
-12
|
%
|
|
Sales
Adjustments2
|
|
|
54.9
|
|
49.9
|
|
|
|
|
|
|
117.4
|
|
100.6
|
|
|
|
|
|
|
Gross
Sales
|
|
$
317.2
|
|
$
356.3
|
|
-11
|
%
|
-10
|
%
|
|
$
656.8
|
|
$
691.1
|
|
-5
|
%
|
-9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Latin
America
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Sales
|
|
|
$
167.2
|
|
$
193.9
|
|
-14
|
%
|
-5
|
%
|
|
$
347.4
|
|
$
371.5
|
|
-6
|
%
|
1
|
%
|
|
Sales
Adjustments2
|
|
|
31.5
|
|
22.8
|
|
|
|
|
|
|
64.4
|
|
49.3
|
|
|
|
|
|
|
Gross
Sales
|
|
$
198.8
|
|
$
216.7
|
|
-8
|
%
|
1
|
%
|
|
$
411.8
|
|
$
420.8
|
|
-2
|
%
|
5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Global Emerging
Markets3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Sales
|
|
|
$
121.6
|
|
$
175.0
|
|
-31
|
%
|
-25
|
%
|
|
$
366.2
|
|
$
453.5
|
|
-19
|
%
|
-18
|
%
|
|
Sales
Adjustments2
|
|
|
19.0
|
|
28.9
|
|
|
|
|
|
|
72.5
|
|
71.6
|
|
|
|
|
|
|
Gross
Sales
|
|
$
140.6
|
|
$
203.9
|
|
-31
|
%
|
-25
|
%
|
|
$
438.7
|
|
$
525.1
|
|
-16
|
%
|
-15
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International
Segment Gross Sales by Brand:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Power
Brands
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Barbie
|
|
|
$
165.9
|
|
$
158.5
|
|
5
|
%
|
11
|
%
|
|
$
359.7
|
|
$
319.6
|
|
13
|
%
|
14
|
%
|
|
Hot Wheels
|
|
114.2
|
|
133.4
|
|
-14
|
|
-9
|
|
|
292.2
|
|
288.4
|
|
1
|
|
3
|
|
|
Fisher-Price and
Thomas & Friends
|
154.3
|
|
206.3
|
|
-25
|
|
-22
|
|
|
349.9
|
|
427.5
|
|
-18
|
|
-18
|
|
|
American
Girl
|
|
0.5
|
|
-
|
|
|
|
|
|
|
1.3
|
|
-
|
|
|
|
|
|
|
Total Power
Brands
|
|
$
435.0
|
|
$
498.2
|
|
-13
|
|
-8
|
|
|
$
1,003.2
|
|
$
1,035.5
|
|
-3
|
|
-2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Toy
Box
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owned
Brands
|
|
$
131.2
|
|
$
139.5
|
|
-6
|
|
0
|
|
|
$
284.5
|
|
$
287.2
|
|
-1
|
|
0
|
|
|
Partner
Brands
|
|
90.3
|
|
139.3
|
|
-35
|
|
-32
|
|
|
219.6
|
|
314.4
|
|
-30
|
|
-30
|
|
|
Total Toy
Box
|
|
$
221.5
|
|
$
278.8
|
|
-21
|
|
-16
|
|
|
$
504.1
|
|
$
601.6
|
|
-16
|
|
-16
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Gross
Sales
|
|
$
656.5
|
|
$
777.0
|
|
-16
|
%
|
-11
|
%
|
|
$
1,507.3
|
|
$
1,637.0
|
|
-8
|
%
|
-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 brand level.
|
|
|
|
3 Prior
period balances have been reclassified to conform with current
period presentation. 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 September 30,
|
|
For the Nine
Months Ended September 30,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions,
except percentage information)
|
|
2018
|
|
2017
|
|
% Change
as Reported
|
|
% Change in
Constant
Currency
|
|
2018
|
|
2017
|
|
% Change
as Reported
|
|
% Change in
Constant
Currency
|
|
|
American Girl
Segment Gross Sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Sales
|
|
|
$
60.8
|
|
$
89.7
|
|
-32
|
%
|
-32
|
%
|
$
169.0
|
|
$
234.8
|
|
-28
|
%
|
-28
|
%
|
|
Sales
Adjustments2
|
|
3.0
|
|
4.2
|
|
|
|
|
|
6.9
|
|
12.6
|
|
|
|
|
|
|
Gross
Sales
|
|
$
63.9
|
|
$
93.9
|
|
-32
|
%
|
-32
|
%
|
$
175.9
|
|
$
247.4
|
|
-29
|
%
|
-29
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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 brand level.
|
|
|
|
|
|
MATTEL, INC. AND
SUBSIDIARIES
|
|
|
|
|
|
|
|
|
|
EXHIBIT
VII
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL
FINANCIAL INFORMATION (Unaudited)1
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF
GAAP AND NON-GAAP FINANCIAL MEASURES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months Ended September 30,
|
|
|
For the Nine
Months Ended September 30,
|
(In millions,
except per share and percentage information)
|
|
20183
|
|
20172,
3
|
|
|
20183
|
|
20172,
3
|
Gross
Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Profit, As
Reported
|
|
|
|
|
$
|
613.1
|
$
|
647.2
|
|
$
|
1,085.1
|
$
|
1,325.7
|
Gross
Margin
|
|
|
|
|
42.6%
|
|
41.5%
|
|
|
36.3%
|
|
40.5%
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset
Impairments
|
|
|
|
-
|
|
-
|
|
|
5.8
|
|
-
|
Severance and
Restructuring Expenses4
|
|
|
5.7
|
|
-
|
|
|
5.7
|
|
-
|
Gross Profit, As
Adjusted
|
|
|
|
|
$
|
618.8
|
$
|
647.2
|
|
$
|
1,096.6
|
$
|
1,325.7
|
Adjusted Gross
Margin
|
|
|
|
|
43.0%
|
|
41.5%
|
|
|
36.7%
|
|
40.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Selling and
Administrative Expenses
|
|
|
|
|
|
|
|
|
|
Other Selling and
Administrative Expenses, As Reported
|
$
|
325.9
|
$
|
381.3
|
|
$
|
1,110.5
|
$
|
1,065.3
|
% of Net
Sales
|
|
|
|
|
22.7%
|
|
24.4%
|
|
|
37.2%
|
|
32.6%
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset
Impairments
|
|
|
|
-
|
|
(14.9)
|
|
|
(6.1)
|
|
(14.9)
|
Non-recurring
Executive Compensation
|
|
|
-
|
|
(3.5)
|
|
|
(1.0)
|
|
(8.3)
|
Severance and
Restructuring Expenses
|
|
|
(25.5)
|
|
(12.6)
|
|
|
(98.2)
|
|
(21.5)
|
Sale of
Assets
|
|
|
|
|
-
|
|
-
|
|
|
1.4
|
|
-
|
Other Selling and
Administrative Expenses, As Adjusted
|
$
|
300.4
|
$
|
350.3
|
|
$
|
1,006.6
|
$
|
1,020.6
|
% of Net
Sales
|
|
|
|
|
20.9%
|
|
22.4%
|
|
|
33.7%
|
|
31.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income
(Loss)
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income
(Loss), As Reported
|
|
$
|
121.9
|
$
|
86.2
|
|
$
|
(343.9)
|
$
|
(88.4)
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset
Impairments
|
|
|
|
-
|
|
14.9
|
|
|
11.9
|
|
14.9
|
Non-recurring
Executive Compensation
|
|
|
-
|
|
3.5
|
|
|
1.0
|
|
8.3
|
Severance and
Restructuring Expenses4
|
|
|
31.2
|
|
12.6
|
|
|
103.9
|
|
21.5
|
Sale of
Assets
|
|
|
|
|
-
|
|
-
|
|
|
(1.4)
|
|
-
|
Operating Income
(Loss), As Adjusted
|
|
$
|
153.0
|
$
|
117.2
|
|
$
|
(228.5)
|
$
|
(43.7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
Information
|
|
|
|
|
|
|
|
|
|
|
|
|
Toys "R" Us Net Sales
Reversal5
|
|
$
|
-
|
$
|
43.0
|
|
$
|
29.5
|
$
|
43.0
|
Toys "R" Us Bad Debt
Expense, Net5
|
|
$
|
(13.0)
|
$
|
-
|
|
$
|
37.3
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Amounts
may not foot due to rounding.
|
2Other
selling and administrative expenses, operating income (loss), and
other non-operating expense, net have been retrospectively restated
to reflect the adoption of Accounting Standards
Update
|
2017-07,
Improving the Presentation of Net Periodic Pension Cost and Net
Periodic Postretirement Benefit Cost.
|
|
|
|
|
|
3 Toys "R"
Us net sales reversal and Toys "R" Us bad debt expense, net are no
longer presented as non-GAAP adjustments for the three and nine
months ended September 30, 2018 and 2017.
|
4
Severance and restructuring expenses recorded within cost of sales
include $5.7 million of non-cash plant restructuring
costs.
|
|
|
|
|
|
5 As a
result of the Toys "R" Us bankruptcy filing and liquidation in the
third quarter of 2017 and first quarter of 2018, respectively,
Mattel reversed net sales for the estimated
uncollectible
|
portion of its sales
in the period. 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.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss) Per
Common Share, As Reported
|
$
|
0.02
|
$
|
(1.75)
|
|
$
|
(1.58)
|
$
|
(2.25)
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset
Impairments
|
|
|
|
-
|
|
0.04
|
|
|
0.03
|
|
0.04
|
Non-recurring
Executive Compensation
|
|
|
-
|
|
0.01
|
|
|
-
|
|
0.03
|
Severance and
Restructuring Expenses4
|
|
|
0.09
|
|
0.04
|
|
|
0.30
|
|
0.06
|
Tax Effect of
Adjustments6
|
|
|
|
-
|
|
(0.01)
|
|
|
(0.01)
|
|
(0.01)
|
Tax
Items7
|
|
|
|
|
0.07
|
|
1.63
|
|
|
0.07
|
|
1.63
|
Net Income (Loss) Per
Common Share, As Adjusted
|
$
|
0.18
|
$
|
(0.04)
|
|
$
|
(1.19)
|
$
|
(0.50)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA and
Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss), As
Reported
|
|
|
$
|
6.3
|
$
|
(603.3)
|
|
$
|
(545.9)
|
$
|
(772.6)
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
|
|
48.2
|
|
24.7
|
|
|
132.7
|
|
68.6
|
Provision for Income
Taxes
|
|
|
|
66.3
|
|
664.5
|
|
|
70.6
|
|
614.4
|
Depreciation
|
|
|
|
|
62.2
|
|
61.6
|
|
|
179.6
|
|
179.8
|
Amortization
|
|
|
|
|
10.2
|
|
5.6
|
|
|
29.9
|
|
16.3
|
EBITDA
|
|
|
|
|
|
193.1
|
|
153.1
|
|
|
(133.1)
|
|
106.5
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset
Impairments
|
|
|
|
-
|
|
14.9
|
|
|
11.9
|
|
14.9
|
Shared-based
compensation
|
|
|
|
13.8
|
|
17.0
|
|
|
36.2
|
|
47.6
|
Severance and
Restructuring Expenses
|
|
|
25.5
|
|
12.6
|
|
|
98.2
|
|
21.5
|
Sale of
Assets
|
|
|
|
|
-
|
|
-
|
|
|
(1.4)
|
|
-
|
Adjusted
EBITDA
|
|
|
|
$
|
232.4
|
$
|
197.7
|
|
$
|
11.7
|
$
|
190.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Amounts
may not foot due to rounding.
|
2Other
selling and administrative expenses, operating income (loss), and
other non-operating expense, net have been retrospectively restated
to reflect the adoption of Accounting Standards Update
2017-07,
|
Improving the Presentation of Net Periodic Pension Cost and Net
Periodic Postretirement Benefit Cost.
|
|
|
|
|
|
3 Toys "R"
Us net sales reversal and Toys "R" Us bad debt expense, net are no
longer presented as non-GAAP adjustments for the three and nine
months ended September 30, 2018 and 2017.
|
4
Severance and restructuring expenses recorded within cost of sales
include $5.7 million of non-cash plant restructuring
costs.
|
|
|
|
|
|
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. For the three and nine months ended September 30, 2018,
adjustments for the U.S. and certain International affiliates were
not tax effected because of the valuation allowance on
deferred
|
tax
assets.
|
|
|
|
|
|
|
|
|
|
|
|
|
7 For the
three and nine months ended September 30, 2018, the amount includes
expense of approximately $24 million related to the provisional tax
for deemed repatriation of accumulated foreign
|
earnings and changes
to the indefinite reinvestment assertion made as a result of U.S.
Tax Reform. For the three and nine months ended September 30,
2017, the amount includes expense of
|
approximately $562
million related to the valuation allowance on U.S. deferred tax
assets that was established in the period.
|
|
|
|
|
|
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SOURCE Mattel, Inc.