Mattel to raise annual forecast after sales jump
Armed with stimulus checks, consumers spend during normally slow post-holiday time
Mattel reported a record 47% rise in quarterly sales on Thursday as Americans armed with stimulus checks snapped up Barbie dolls and Hot Wheels cars in the usually slow post-holiday months.
The toymaker’s shares rose more than 6% to $22.22 in extended trading.
U.S. consumer confidence has got a shot in the arm as vaccination drives gather speed and the government hands out fresh stimulus checks, helping Mattel bring in families even in the year’s slowest period for toymakers.
Mattel Chief Executive Officer Ynon Kreiz told Reuters the company would raise its full-year sales growth outlook during an analyst call later on Thursday, from a prior forecast of a mid-single-digit percentage increase.
“Toys continue to prove their importance to parents as to where they choose to spend their disposable income,” Kreiz said in an interview.
“We are seeing a strong start to the second quarter including the Easter week and we’re planning for another great holiday season.”
California-based Mattel, which has been benefiting from stuck-at-home parents using toys to keep their kids entertained, posted net sales of $874.2 million in the first quarter ended March 31, beating analysts’ average estimate of $684.2 million, according to IBES data from Refinitiv.
Coronavirus lockdowns and store closures had hit the year-ago quarter, but Mattel said that impacted the 47% sales jump only a little.
Overall first-quarter gross billings at Barbie, Mattel’s biggest brand, rose 87% to $276.2 million, while Hot Wheels billings rose 16% to $184.6 million.
Excluding certain items, Mattel posted a loss of 10 cents per share, smaller than the 35 cents per share loss that analysts had expected.
The company on Thursday became the latest to forecast higher transportation and raw material costs this year, but Kreiz said it would offset that with sales growth.