Doll Snacks On Mattel Profit
The doll that couldn’t stop chewing took a bite out of toy maker Mattel Inc.’s fourth-quarter earnings, the company reported Wednesday.
The El Segundo-based toy giant took an $8-million charge to after-tax earnings related to its Cabbage Patch Snacktime Kids doll, which was pulled from the market after several children got their hair and hands stuck in the dolls’ mouths.
Mattel, which offered a $40 refund to each owner of the dolls, said the move trimmed its sales by $10 million.
After one-time charges, Mattel’s fourth-quarter profit was $113 million, or 41 cents per share, compared with $112 million, or 40 cents, a year ago.
The results beat by a penny Wall Street expectations.
Investors knocked $1.25 off Mattel’s shares Wednesday, which closed at $27.375 on the New York Stock Exchange.
Mattel took an after-tax accounting charge of $15.1 million for royalties and other fees relating to its proposed $755-million merger with Tyco Toys Inc.
Tyco, of Mount Laurel, N.J., narrowed its fourth-quarter loss, thanks to the unexpected popularity of the toy based on the Sesame Street character Elmo.
For the quarter, Tyco lost $7.4 million, or 29 cents a share. A year earlier it lost $17.3 million, or 52 cents a share.
At a Glance:
Goodyear Tire & Rubber Co. said its fourth-quarter profit rose 12% to $164.0 million, or $1.05 a share, up from net income of $146.4 million, or 96 cents, in the year-ago quarter.
The nation’s largest tire maker said it will buy back $600 million in stock over three years. Goodyear also announced an alliance with Japan’s Sumitomo Rubber Industries Ltd. in which the companies will make tires for each other in their respective countries to reduce shipping costs.
Northrop Grumman Corp. said its fourth-quarter earnings rose 19% before a charge for plant closings, fueled by gains in its electronics and aircraft component businesses. Profit from operations rose to $69 million, or $1.18 a share, compared with net income of $58 million, or $1.17, in the year-ago period. The results matched expectations.
Aetna Inc. reported a loss of $107.1 million in the fourth quarter due to the costs of reorganizing its health business. The loss equaled 80 cents a share, contrasted with profit of $175.7 million, or $1.53 a share, a year ago.
Rubbermaid Inc. reported a 21% drop in fourth-quarter profit, earning $19.9 million, or 13 cents a share, down from $25.3 million, or 16 cents, in the year-ago quarter.
New York Times Co. reported an 80% rise in fourth-quarter earnings to $70.1 million, or 72 cents a share, from $38.9 million, or 40 cents, a year ago.
* More Earnings: D4
