SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report: February 5, 1997
MATTEL, INC.
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(Exact name of registrant as specified in its charter)
Delaware 001-05647 95-1567322
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File No.) Identification No.)
333 Continental Boulevard, El Segundo, California 90245-5012
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (310) 252-2000
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N/A
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(Former name or former address, if changed since last report)
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Item 5. Other Events
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Mattel, Inc. hereby incorporates by reference herein its
press release dated February 5, 1997, regarding its 1996
fourth quarter results of operations, a copy of which is
included as Exhibit 99.0 attached hereto.
Item 7. Financial Statements and Exhibits
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(a) Financial statements of businesses acquired: None
(b) Pro forma financial information: None
(c) Exhibits:
99.0 Press release dated February 5, 1997.
<PAGE>
SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
MATTEL, INC.
Registrant
By: /s/ Robert Normile
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Robert Normile
Vice President, Assistant
Date: February 5, 1997 Secretary and Assistant
---------------- General Counsel
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FOR IMMEDIATE RELEASE Contact: Glenn Bozarth
February 5, 1997 Mattel, Inc.
(310) 252-3521
MATTEL REPORTS EARNINGS AND SALES INCREASES
FOR 1996 FOURTH QUARTER AND FULL-YEAR
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LOS ANGELES, Feb. 5 -- Mattel, Inc. today reported that income per share
for the full-year 1996, before an accrual and special charge, increased 14
percent on a 4 percent increase in sales.
Net income was $378 million or $1.36 per share, after a $.03 impact
from a Snacktime Kids refund accrual and a $.05 special accounting charge.
In 1995, net income was $358 million or $1.26 per share. Net sales for
1996 totaled $3.79 billion, versus $3.64 billion in 1995.
Before the impact of the accrual and charge, income for the 1996
fourth quarter was up 22 percent on a 4 percent increase in sales. After
these items, net income for the quarter was $113 million, versus $112
million in 1995, and net sales were $1.19 billion, compared with $1.16
billion in the prior year.
"Despite a difficult retail environment, worldwide sales of our four
core brands of Barbie, Fisher-Price, Disney and Hot Wheels increased 10
percent in 1996, even with a 4 percent decrease in sales for Fisher-Price,"
Jill E. Barad, Mattel's president and chief executive officer, said. "Our
38-year-strong Barbie brand led the way with a 20 percent increase in
worldwide sales.
"The increased focus on our core brands helped us maximize
profitability in 1996, with gross margin increasing from 49.2 percent in
1995 to 50.8 percent last year," Barad said.
In response to concerns related to its Snacktime Kids dolls, Mattel in
January announced that it would provide cash refunds to consumers who had
purchased the dolls, and would voluntarily withdraw all product from retail
shelves. A 1996 fourth quarter accrual related to this action resulted in
a negative impact of $10 million to sales and $8 million to after-tax
earnings.
The company also took a special after-tax charge of $15.1 million
after discussions with the SEC staff concerning Mattel's method of
accounting for certain royalties and participation fees related to prior
periods. Mattel and its auditors continue to believe that the company's
accounting treatment was appropriate. Nevertheless, Mattel has accepted
the SEC staff's accounting treatment in order to proceed with its pending
merger with Tyco.
The company also announced that the Mattel board of directors has
declared a quarterly dividend of $.06 per share on its common stock. The
dividend is payable April 3, 1997 to shareholders of record on March 14,
1997. In addition, the Mattel board authorized the repurchase of up to 6.5
million shares of the company's common stock during 1997.
Mattel, Inc. is the worldwide leader in the design, manufacture and
marketing of children's toys. With headquarters in El Segundo, California,
Mattel has offices and facilities in 36 countries and sells its products in
more than 140 nations throughout the world.
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<TABLE>
MATTEL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
<CAPTION>
FOR THE FOR THE
THREE MONTHS ENDED YEAR ENDED
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Dec. 31, Dec. 31, Dec. 31, Dec. 31,
(In thousands, except per share amounts) 1996 1995 1996 1995
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<S> <C> <C> <C> <C>
Net Sales $ 1,190,545 $ 1,155,284 $ 3,785,958 $ 3,638,812
Cost of sales 571,323 574,785 1,863,135 1,849,650
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Gross Profit 619,222 580,499 1,922,823 1,789,162
Advertising and promotion expenses 236,876 216,824 606,823 584,497
Other selling and administrative expenses 176,027 170,286 647,112 603,061
Other expense (income), net 7,115 8,282 25,808 (4,887)
Special charge (a) 21,810 - 21,810 -
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Operating Profit 177,394 185,107 621,270 606,491
Interest expense 23,038 21,785 75,529 73,589
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Income Before Income Taxes 154,356 163,322 545,741 532,902
Provision for income taxes 40,900 51,300 168,100 175,100
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Net Income $ 113,456 $ 112,022 $ 377,641 $ 357,802
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Net Income Per Share (b) $ 0.41 $ 0.40 $ 1.36 $ 1.26
=========== =========== =========== ===========
Average Number of Common and Common
Equivalent Shares Outstanding 275,184 280,916 278,385 281,015
=========== =========== =========== ===========
<CAPTION>
MATTEL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
Dec. 31, Dec. 31,
(In thousands) 1996 1995
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ASSETS
<S> <C> <C>
Cash and marketable securities $ 500,625 $ 483,457
Accounts receivable, net 732,307 679,283
Inventories 372,686 350,841
Prepaid expenses and other current assets 165,223 177,238
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Total current assets 1,770,841 1,690,819
Property, plant and equipment, net 579,613 499,314
Other assets 543,068 505,376
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Total Assets $ 2,893,522 $ 2,695,509
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LIABILITIES AND SHAREHOLDERS' EQUITY
<S> <C> <C>
Short-term borrowings $ 20,485 $ 15,520
Current portion of long-term liabilities 106,069 33,215
Accounts payable and accrued liabilities 666,065 660,763
Income taxes payable 167,749 138,183
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Total current liabilities 960,368 847,681
Long-term debt 153,758 260,868
Medium-Term notes 220,000 220,000
Other long-term liabilities 111,609 91,791
Shareholders' equity 1,447,787 1,275,169
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Total Liabilities and Shareholders' Equity $ 2,893,522 $ 2,695,509
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<FN>
(a) Represents a nonrecurring charge related to the accounting for certain
royalties and participation fees in prior periods.
(b) Net income per share was $1.44 for the year ended December 31, 1996,
before the $0.03 effect of a Snacktime Kids refund accrual and the $0.05
effect of the Special charge.
</TABLE>
