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: April 17, 1998
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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Information to be included in the Report
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Item 5. Other Events
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Mattel, Inc. hereby incorporates by reference herein its
press release dated April 16, 1998 regarding its 1998
first 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 April 16, 1998.
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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/ LELAND P. SMITH
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Leland P. Smith
Date: April 17, 1998 Assistant General Counsel
-------------- and Secretary
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FOR IMMEDIATE RELEASE CONTACT: Mattel, Inc.
News Media Investor Relations
Glenn Bozarth Mike Salop
310-252-3521 310-252-2703
MATTEL REPORTS STRONG EARNINGS INCREASE,
REMAINS ON TRACK TO ACHIEVE FULL-YEAR PROFIT TARGET
LOS ANGELES, April 16 -- Mattel, Inc. today reported that net income for the
1998 first quarter ended March 31 more than doubled to $12.7 million or
$.04 per share from $5.1 million or $.01 per share in the year-ago first
quarter, before a 1997 Tyco Integration and Mattel Restructuring charge.
The charge resulted in a 1997 first quarter loss of $204.6 million or $.72
per share.
Net sales for the 1998 first quarter were $705 million, versus $694
million in the 1997 quarter, up 2 percent in U.S. dollars and 4 percent
in local currency.
"The fundamental advantage of our diverse brand portfolio is evident
in our results, which were achieved despite an unexpected change in buying
practices by Toys "R" Us," Jill Barad, Mattel's chairman and chief executive
officer, said. "As a result of the Toys "R" Us situation and the managing
down of specific 1997 doll inventory, Barbie shipping declined in the
quarter, but we did see a very strong increase in Barbie retail sales. Our
Infant and Preschool category sales experienced excellent growth, as did our
Wheels and Entertainment businesses," she said. "We also saw a favorable
trend in our international business, particularly in Europe.
"Our balance sheet remains strong, with inventories and receivables
being well managed and cash at a healthy $332 million," Barad said. "The
strength of our portfolio of brands and our strong financial position give
us continued confidence that we will achieve our projected earnings per
share growth of at least 15 percent for the year."
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 150 nations throughout the world.
Note:
Forward-looking statements included in this release with respect to the
financial condition, results of operations and business of the company,
which include, but are not limited to, the restructuring charge, cost
savings and profitability, are subject to certain risks and uncertainties
that could cause actual results to differ materially from those set forth
in such statements. These include without limitation: the company's
dependence on the timely development, introduction and customer acceptance
of new products; possible weaknesses of international markets; the impact
of competition on revenues and margins; the effect of currency fluctuations
on reportable income; and other risks and uncertainties as may be detailed
from time to time in the company's public announcements and SEC filings.
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MATTEL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
<CAPTION>
FOR THE
THREE MONTHS ENDED
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March 31, March 31,
(In thousands, except per share amounts) 1998 1997 (a)
- ---------------------------------------- ---------- ----------
<S> <C> <C>
Net Sales $ 705,164 $ 693,520
Cost of sales 381,246 370,709
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Gross Profit 323,918 322,811
Advertising and promotion expenses 98,081 102,626
Other selling and administrative expenses 183,791 185,286
Integration/restructuring costs (c) - 275,000
Other expense, net 7,898 7,882
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Operating Profit (Loss) 34,148 (247,983)
Interest expense 16,392 19,636
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Income (Loss) Before Income Taxes 17,756 (267,619)
Provision (benefit) for income taxes 5,087 (62,995)
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Net Income (Loss) 12,669 (204,624)
Less: dividends on convertible
preferred stock 1,990 2,840
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Net Income (Loss) Applicable to $ 10,679 $ (207,464)
Common Shares ========== ==========
Net Income (Loss) Per Share - Basic (a)(b) $ 0.04 $ (0.72)
========== ==========
Average Number of Common Shares
Outstanding - Basic (a) 293,048 288,382
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Net Income (Loss) Per Share - Diluted (a)(b) $ 0.04 $ (0.72)
========== ==========
Average Number of Common and Common Equivalent
Shares Outstanding - Diluted (a) 298,164 288,382
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<FN>
(a) Consolidated results and share and per share data are restated for the
March 1997 merger with Tyco Toys, Inc.
(b) Income per share for March 1997, before the $0.73 per share effect of
the merger-related nonrecurring charge of $210 million after taxes,
was $0.01 per share.
(c) Represents a nonrecurring charge for transaction, integration and
restructuring costs related to the Tyco merger. The related tax
benefit of $65 million is included in the provision for income
taxes.
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<TABLE>
MATTEL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
<CAPTION>
March 31, March 31, Dec. 31,
(In thousands) 1998 1997 (a) 1997
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ASSETS
<S> <C> <C> <C>
Cash $ 331,884 $ 144,659 $ 694,947
Accounts receivable, net 987,906 977,479 1,091,416
Inventories 531,623 512,847 428,844
Prepaid expenses and other current assets 251,397 193,636 246,529
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Total current assets 2,102,810 1,828,621 2,461,736
Property, plant and equipment, net 602,793 608,350 601,597
Other assets 738,191 824,743 740,458
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Total Assets $ 3,443,794 $ 3,261,714 $ 3,803,791
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LIABILITIES AND SHAREHOLDERS' EQUITY
<S> <C> <C> <C>
Short-term borrowings $ 18,204 $ 16,865 $ 17,468
Current portion of long-term liabilities 13,577 105,393 13,659
Accounts payable and accrued liabilities 636,684 712,841 939,562
Income taxes payable 134,284 113,358 202,735
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Total current liabilities 802,749 948,457 1,173,424
Long-term debt 154,089 301,877 155,036
Medium-Term notes 520,500 260,000 520,500
Other long-term liabilities 126,210 114,686 132,761
Shareholders' equity 1,840,246 1,636,694 1,822,070
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Total Liabilities and Shareholders' Equity $ 3,443,794 $ 3,261,714 $ 3,803,791
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</TABLE>
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