Mattel Inc on Thursday raised its 2021 sales forecast, saying it would overcome industry-wide shipping disruptions to ring in a strong holiday season steered by Barbie and Hot Wheels, sending its shares up 6% in extended trading.
The company has pulled forward production, contracted more ocean freight capacity and secured access to additional ports to keep up supply during the most crucial time of the year for toymakers, Chief Executive Officer Ynon Kreiz told Reuters.
While demand for toys is at an all-time high, severe global supply chain bottlenecks have threatened to keep store shelves empty this holiday season, leaving retailers and suppliers scrambling for ways to speed up product shipments.
"We've been working through supply chain disruptions, it's not a normal year. But even with that, we expect to have lots of toys under trees this Christmas holiday," Kreiz said.
Net sales rose 8% to $1.76 billion in the third quarter, as customers looking to keep their children entertained during the pandemic snapped up Hot Wheels cars and Barbie dolls.
Analysts had estimated sales of $1.69 billion, according to IBES data from Refinitiv.
The Fisher Price baby toys maker also recorded a 50% surge in sales of action figures based on characters from popular franchises such as "Masters of the Universe."
Its decision to raise prices earlier this year to counter higher commodity costs had not hurt demand, Kreiz said.
Mattel said it expects full-year constant currency net sales to increase by about 15%, compared with its prior forecast for a 12% to 14% rise.
Third-quarter net income jumped 161% to $812.6 million, or $2.29 per share, helped by a $510 million non-cash benefit from the release of reserves on some deferred tax assets.
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