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Mattel's First-Quarter Loss Nearly Doubles

Earnings: Toy maker matches analysts estimates. Sales increase 5.6% as restructuring continues.

April 20, 2001|From Reuters

Mattel Inc., maker of Barbie dolls and Hot Wheels cars, said Thursday that its first-quarter loss nearly doubled, matching Wall Street estimates, but the toy giant gained in sales as it continued its financial restructuring.

Mattel said, it posted a first-quarter loss from continuing operations of $12.1 million, or 3 cents a share, excluding charges, compared with a loss of $6.2 million, or 1 cent a share in the year-ago period.

Wall Street analysts expected a loss in the range of 2 cents to 5 cents a share with a consensus loss of 3 cents, according to research firm First Call/Thomson Financial.

Mattel shares fell $1.49 to close at $15.44 on the New York Stock Exchange.

The El Segundo-based company took a $7-million charge in the quarter related to its $250-million financial realignment plan.

Mattel said sales from continuing operations for the quarter increased 5.6% to $731.9 million, from $693.3 million a year earlier.

Worldwide revenue was up 6%, though worldwide sales of its signature Barbie models remained unchanged. Hot Wheels sales were up 24%, American Girl sales grew 14% and Fisher-Price was up 8%, it said.

Mattel said operating income also rose 15% for the quarter to $18.2 million.

Market analysts applauded the toy maker's figures, noting the better-than-expected sales growth and operating income performance. In a lackluster toy market, Mattel's results should improve toward the end of the year, they said.

"I was pretty encouraged. Sales were stronger than we anticipated. Particularly, the international results seem strong," said Gerard Klauer Mattison & Co. analyst Melissa Williams.

Though Mattel's earning losses were in line with market estimates, Williams said the first quarter was generally not so important for the toy industry. Williams expects earnings and sales momentum in the latter half of the year.

Mattel shares have risen 48% over 52 weeks, outperforming the S&P leisure index, which includes toy maker Hasbro Inc. and Harley-Davidson Inc., by 25% in the same period.

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