Home Forum Columns Galleries Archives About

It is currently Fri May 25, 2018 3:25 am

All times are UTC - 8 hours

Post new topic Reply to topic  [ 1 post ] 
Author Message
 Post subject: Mattel, Hasbro results miss 3rd-quarter estimates
PostPosted: Mon Oct 17, 2005 12:33 pm 
User avatar
proverbial old fart

Joined: Sun Nov 04, 2007 6:30 pm
Posts: 3207
Mon Oct 17, 2005 05:14 PM ET
(Adds closing stock price)
By Nicole Maestri

NEW YORK, Oct 17 (Reuters) - The top two U.S. toy makers reported disappointing third-quarter results on Monday, with shares of Mattel Inc. (MAT.N: Quote, Profile, Research) hitting their lowest level in almost five years after it said U.S. Barbie sales plunged 30 percent.

The results showed the strain toy makers continue to face from intense pricing competition and rising energy costs, which are squeezing both profit margins and consumers' wallets.

The numbers also showed that Mattel, the largest U.S. toy maker, and rival No. 2 Hasbro Inc. (HAS.N: Quote, Profile, Research) are having varying degrees of success navigating the tough environment.

While Mattel posted a 12 percent decline in profit and said it will raise prices next year, Hasbro's net earnings rose 4 percent. Hasbro was boosted by strong sales of its Star Wars products and surprising strength in its games division, which includes the classic Candy Land and Monopoly board game brands and is not as vulnerable to rising plastic costs.

"The staggering number (for Mattel) was that U.S. Barbie dipped 30 percent. It's hard to say when people decide to throw in the towel, but obviously some folks have thrown in the towel," said Ryan Beck & Co. analyst Margaret Whitfield, referring to Mattel's stock drop.

Shares of Mattel closed down almost 5 percent at $15.23 after trading as low as $14.80. Hasbro declined fractionally to $18.79. Mattel shares are now down 22 percent for the year, while Hasbro is down 3 percent and the Dow Jones U.S. Toy Index has fallen 10 percent.


Mattel reported third-quarter earnings of $225.3 million, or 55 cents per share, down from $255.8 million, or 61 cents per share, a year earlier.

Analysts on average had expected 61 cents per share, according to Reuters Estimates.

Meanwhile Hasbro, also known for its Furby toys, reported third-quarter earnings of $92.1 million, or 47 cents per share, up from $88.7 million, or 43 cents per share, a year earlier.

Wall Street was expecting earnings of 51 cents per share.

"Our performance year-to-date ... reinforces the confidence we have in our ability to achieve our full-year financial goals," said Alfred Verrecchia, president and chief executive, in a statement.

Mattel, which last week announced a consolidation of its Mattel and Fisher-Price units, is trying to stem the decline in Barbie sales as girls are being lured to competing Bratz dolls, made by MGA Entertainment Co.

In the quarter, Mattel said worldwide gross sales for the Barbie brand dropped 18 percent.

"Third-quarter results are disappointing as sales increases in much of our portfolio were offset by declines in the Barbie brand," Chief Executive Robert Eckert said in a statement. "Overall, we continue to experience the effect of a difficult retail environment as well as cost increases."

Mattel's quarterly revenue was flat at $1.67 billion. Analysts were expecting $1.72 billion.

With rising oil prices boosting shipping costs and the cost of plastics needed to make toys, Mattel said it intends to raise prices.

"Our prices have not kept pace with our cost increases, so we will certainly be working with customers in the months ahead," Eckert said. "We are planning on taking price increases in 2006 to recover some of the costs we've experienced."

Hasbro's Verrecchia said it remains to be seen what impact the higher cost of gasoline and expected increases in home heating costs will have on consumer spending during the holiday season.

Hasbro's quarterly revenue rose to $988.1 million from $947.3 million. Analysts were expecting revenue of $997.1 million.

Revenue in its U.S. Toys segment, which includes its Star Wars and Furby toys, was $393.1 million, up from $369.7 million a year ago. Its games segment revenues were $252.9 million, up from $236.5 million a year before.

© Reuters 2005. All Rights Reserved.

Display posts from previous:  Sort by  
Post new topic Reply to topic  [ 1 post ] 

All times are UTC - 8 hours

Who is online

Users browsing this forum: No registered users

You cannot post new topics in this forum
You cannot reply to topics in this forum
You cannot edit your posts in this forum
You cannot delete your posts in this forum

Search for:
Jump to: