Barbie, Hot Wheels, Jurassic World and the excitement around this year’s Toy Story 4 release have helped Mattel to better than expected first quarter financials, with smaller losses and improved gross margins.
While net sales dropped three per cent to $689.2 million the fall in sales was less than expected, prompting optimism from Mattel’s boss Ynon Kriez for the company’s ongoing turnaround strategy.
Mattel’s dolls category grew three per cent to $253 million, within which the Barbie brand accounted for 13 per cent of sales. This, Kriez has said, was fuelled by the launch of Barbie’s 60th anniversary campaign at the start of the year.
It off-sets the continued drop in sales of American Girl dolls.
Meanwhile, the vehicles category also saw growth of two per cent, hitting $183 million. The Hot Wheels brand has grown nine per cent thanks to efforts to ‘take the brand beyond the toy aisle,’ and grow its content across the likes of YouTube, and Matchbox sales grew 13 per cent.
In North America, net sales grew five per cent, driven by growth in action figures, building sets and games, including Toy Story – spurred by hype around this year’s Toy Story 4 release – and Jurassic World. The combined sector saw sales grow 22 per cent to $150 million.
Elsewhere, infant and pre-school took a dive of 11 per cent, with both the Fisher-Price and Thomas brands dropping five per cent. The sector – a former powerhouse of the Mattel offering – ended its first quarter at $194 million.
Fisher-Price recently issued a recall of its Rock n Roll Play Sleeper, the estimated total impact of which is $27 million. Mattel is expecting additional recall related expenses in the year, but does not predict them to be material.
Of the first quarter results, Mattel boss Kriez, said: “This was another strong quarter, demonstrating meaningful progress in the execution of our strategy, a significant improvement in profitability and a solid performance in our top line.”