Mattel Does Not Have a Very Good Financial Quarter
Second Quarter Highlights
- Worldwide net sales down 9%;
- North American Region gross sales down 8% and International Region gross sales down 9%;
- Worldwide gross sales by core brands: Barbiedown 15%; Hot Wheels down 2%; Fisher-Price down 17% and American Girl up 6%;
- Operating income of $1.0 million compared to operating income of $94.8 million in the second quarter of 2013 (98% drop);
- Entertainment Group (including Games/Puzzles/Radica & CARS/PLANES) down 19%.
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17 July 2014
7 Comments
A couple of thoughts regarding Cars and Planes sales.
Mattel needs to get on ebay and shut down the back door. New planes are selling at very high prices. Same thing with new Cars releases. Ebay is flooded with cheap haulers as well. thousands sold. Its obvious people want the haulers from Cars, not just the paultry 3 that were re-releases this year at Walmart. We saw all the haulers at Peterson so we know that Mattel made the prototypes, yet nothing at retail. Mattel starts new lines then stops. Its frustrating. I’ve hoped they would finish the hauler and team sets from Cars, it looked promising after the Peterson exhibits.
Some sellers of out China have had 100’s of the original planes in stock, and selling those cheaply with almost free shipping (subsidized cheap shipping by Chinese government. I saw one seller that sold 180 of one plane with many more in stock.
Same thing with Cars. It seems that Mattel is blind to what’s happening to their inventory. Meanwhile here in the USA we have not seen any new releases of planes in forever. If many people are buying cheaply on ebay out of China, why would they buy the new releases in stores that we still haven’t seen stocked? (Van der bird, Ireland Plane, etc.)
I’ll comment based on my experience in the model railroad industry, where China was used as the production site. Often the “back door” on China sales was in fact controlled by the manufacturer as a supplementary source of pure profit income. If indeed thousands upon thousands of these Mattel products are going out the factory back door, and it isn’t being stopped, there must be some reason why.
Look at it this way, a Car in packaging on the pegs in Walmart is what, maybe $4 to $6, and Walmart or the other retailers takes a cut of that after Mattel has done all the distribution and marketing. Yet that same toy Car (or Plane), shipped from China with no packaging, and China subsidized postage, can be sold for $15 or $20, and since sales are funneled through a third party, the maker (Mattel?) has no reportable income.
We may be seeing the wave of the future, where the maker controls the market without the retailer even being in the picture.
I am one of those that had long supported carded stuff but with the new pricing at Malaysia i had cut down my purchase on Cars. Singles had a raised of approximate 1 USD and Deluxe is 2 USD. That basically tells me don’t buy multiple carded stuff. Just stick to 1 carded and 1 loose policy.
However, that relates back to backdoor… backdoor new cars are 1/2 the price i am paying for carded. So end up i usually buy my loose via backdoor while watiing for the carded to turn out at stores.
Talking about shutting down the backdoor? I think they have been putting efforts into it. However, when the supply plummet what take place? The fake become the new supply chain. The latest fake from backdoor is Case A planes and Francesco MaMa (aren’t we suppose to get that on carded? still no sign of it?)…
Maybe if they would make new character cars and not rerererererepeat the same ones…. might look better on the end result
I agree… I’m not buying nearly as many 2014 Cars… I decided I wasn’t going to buy everything on the 2014 cardback, just new releases and Cars I really like.
If Mattel would like to sell more Cars, give us what we want:
New Team Crew sets (crew chief and pittys)
New Haulers
New Toons
I’ve been most excited in 2014 about the missing 2012 Movie Moments finally being released in the US at TJ Maxx and Marshalls stores… Now how about Taia Decotura and Taco Truck Mater being released in the US?
Whoa, not looking good for Mattel!
From an operating income of almost $95 million last year 2nd Qtr, to only $1 million this year? I smell an accounting rat, perhaps some kind of poison pill or one time write-off charge? Is Mattel in any way in danger of being the target of a hostile take-over?
(MET: Some of that seems to be related to the purchase of MegaBloks but net income went down from 70MM to around 28 MM also).