Tags: Mattel | Profit | earnings | costs

Mattel's Profit Tops Estimates on Lower Costs

Tuesday, 17 Jul 2012 07:06 AM

Mattel Inc. reported a higher-than-expected quarterly profit on Tuesday as the world's largest toymaker kept a tight lid on costs to offset weak global demand and a strong dollar.

The company, which is home to brands such as Barbie, Hot Wheels and Fisher-Price, said its second-quarter net income had risen to $96.2 million, or 28 cents a share, from $80.5 million, or 23 cents a share, a year earlier.

Analysts on average were looking for a profit of 21 cents a share, according to Thomson Reuters I/B/E/S.

Sales were flat at $1.16 billion, while analysts expected $1.13 billion.

Mattel partly offset the effect of unfavorable currency exchange rates by spending fewer dollars on making and advertising its products.

A stronger dollar brings down the value of exported goods by U.S. companies.

The company has also found it hard to replicate the success of last year's "Cars 2" movie-themed toy line with its newer playthings tied to "Brave" and the latest Batman movie, analysts have said.

Mattel's results come as toy companies gear up for the all-important holiday selling season, when many of them make more than a third of their sales.

Smaller rival Hasbro Inc is due to report its results next week.

Mattel sells toys through retailers such as Wal-Mart Stores Inc., Toys R Us Inc., and Target Corp. as well as through its own catalog and website.

© 2017 Thomson/Reuters. All rights reserved.

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