Mattel slump worsens as it reports big Q3 loss

NEW YORK: Shares of slumping US toymaker Mattel tumbled Friday after it reported sharply lower thirdquarter sales as the Toys “R” Us bankruptcy added to its growing list of woes.

Mattel suffered sales declines in virtually every important product line, including Barbie, the Fisher-Price educational brand and American Girl, prompting it to suspend its dividend and announce additional cost cuts.

Shares finished down 8.9 percent at $14. The stock

has lost 52 percent since January. Mattel was also downgraded by both S&P and Moody’s following the report. “Our Q3 performance was clearly disappointing, led by compression in North America driven by Toys “R” Us filing for bankruptcy, tighter retailer inventory management and challenges with certain underperforming brands,” said chief executive Margo Georgiadis.

“We are taking bold steps to simplify our business and right size our cost structure in alignment with our strategy.”

Georgiadis, a former Google executive, was tapped in January to turn around Mattel, whose sales had been hurt by the loss of the key Princess dolls contract to rival Hasbro, which also makes toys under the lucrative “Star Wars” franchise.

Hasbro also cited the Toys “R” Us bankruptcy earlier this week as it cut its sales growth forecast. But Hasbro still reported slightly higher third-quarter profits. —AP