Toymaker Mattel said Thursday that its sales nearly doubled as families spent more on toys for their children, helped by more disposable income due to government stimulus checks.
The company’s stock rose more than 7% in extended trading.
Typically, the first quarter is a weak period for toy sales, as it follows the influx of sales during the holiday quarter.
Mattel CEO Ynon Kreiz also credited the company’s turnaround efforts, and said it had grown its market share for three consecutive quarters.
“We are strengthening our position as a consistent leader in the toy industry,” he said. “We believe we are very well-positioned to improve profitability and accelerate topline growth in 2021 and beyond.”
Here’s what the company reported for the first quarter compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:
- Losses per share: 10 cents adjusted vs. 35 cents expected
- Revenue: $874.2 million vs. $684.2 million expected
Mattel’s net loss narrowed to $115.2 million, or 33 cents per share, from a loss of $210.7 million, or 61 cents per share, a year earlier.
Excluding items, Mattel lost 10 cents per share, which is less than the loss of 35 cents per share expected by analysts surveyed by Refinitiv.
Revenue rose 47% to $874.2 million from $594 million a year ago, beating analysts’ expectations of $684.2 million.
The company continued to see strong sales of dolls in the latest period, with net sales of its American Girl brand rising 22%. Barbie, Mattel’s most known brand, also grew in popularity due to new product launches and innovations.
“Barbie’s cultural relevance truly has never been stronger,” said Richard Dickson, Mattel’s president and chief operating officer. “We’ve been leaning into diversity, inclusivity and social impact and we’ve seen this reflected in the success of Fashionistas, which also had double-digit increases.” He also added that products like Color Reveal and Barbie Extra grew incrementally in the first quarter.
During a conference call with analysts, Mattel said it expects revenue to rise 6% to 8% this year, in constant currency. Previously, the company was aiming for a mid-single digit sales gain this year.
The higher forecast reflects not only the strong sales in the first quarter, but the company said it was “off to a strong start in the second quarter.”
“We believe we are well-positioned to gain momentum for the full year,” said CFO Anthony DiSilvestro, in a press release.
In addition, Mattel expects higher than anticipated cost inflation, citing plastics and ocean freight as two examples.
Read the full earnings release here.
Source: Business - cnbc.com
