The vacation procuring season produced the most effective end-of-the-year quarter for Mattel in additional than a dozen years after toy gross sales
The vacation procuring season produced the most effective end-of-the-year quarter for Mattel in additional than a dozen years after toy gross sales elevated by double digits, outpacing the trade, CEO Ynon Kreiz informed CNBC’s Jim Cramer Wednesday.
In its fourth-quarter report launched after Tuesday’s shut, Mattel posted $1.6 billion in gross sales, up 10% from the year-ago quarter. It marks the primary time the toymaker’s gross sales grew double digits in a vacation quarter since 2006 when the determine rose greater than 14%.
“This was an distinctive quarter for Mattel with our greatest efficiency in years with sturdy shopper demand and one other milestone yr for the corporate,” Kreiz stated in a “Mad Cash” interview.
The efficiency, which adopted double-digit development within the third quarter, is one signal that the corporate’s multi-year restoration plan is yielding outcomes below Kreiz’s management. He highlighted that the corporate can be enhancing money flows.
Mattel had its first development yr since 2013 when revenues had been simply shy of $6.5 billion. For calendar yr 2020, Mattel reported $4.58 billion in income, almost 2% larger than in 2019, and $127 million in web revenue, the primary worthwhile yr for the corporate since 2016, in line with FactSet. The outcomes had been higher than what analysts forecast.
Barbie had the most effective development of Mattel’s product traces, with gross sales surging 16% on the yr.
“This isn’t simply in regards to the quarter or the yr,” stated Kreiz, who grew to become chief govt within the first half of 2018. “It is in regards to the multi-year technique that’s monitoring very properly, which places us in a powerful place to proceed to extend profitability and speed up our development in 2021 and past.”
That multi-year technique features a checklist of targets, together with restoring profitability and regaining topline development within the short-to-mid time period whereas capturing the complete worth of its mental properties within the mid-to-long time period.
Constructing a web-based retail and e-commerce technique, together with producing movies involving Mattel manufacturers are a part of the corporate’s long-term imaginative and prescient.
The corporate launched a movie and tv divisions in 2018 and has greater than 50 tasks within the works, with some at the moment in manufacturing and plenty of within the improvement stage.
Among the many tasks are an Uno live-action movie, a Whac-A-Mole recreation present and a Thomas & Associates sequence, Kreiz stated.
“That is a part of our mid- to long-term technique,” Kreiz stated. “These tasks take time given the size and their ambition, however we’re properly below manner in placing them in place and, you realize, in success this may be transformative.”
Wanting ahead, Mattel tasks gross sales to develop by mid-to-single digits this yr, barring coronavirus impression and different financial uncertainties. The corporate plans to spend between $125 million and $150 million on investments and different priorities.
Regardless of the sturdy quarterly report, Mattel shares dropped 2% Wednesday to an $18.47 shut. 12 months so far, the inventory is up almost 6%.