Advertisement

Mattel Posts Wider Loss on Charge

Share via
From Times Staff and Wire Reports

Mattel Inc., the world’s largest toy company, reported a wider net loss Thursday as it took a big charge for the purchase of American Girl dolls.

The company’s stock, however, rose on news that revenue climbed, margins improved and operating earnings beat expectations.

The El Segundo-based maker of Barbie dolls and Hot Wheels cars said its first-quarter net loss widened to $256.2 million, or 59 cents a share, from last year’s loss of $34 million, or 8 cents a share. This year’s first-quarter figure includes a $252.2-million charge based on a change in accounting procedures, writing down goodwill from the $700-million 1998 purchase of Pleasant Co., the maker of American Girl dolls.

Advertisement

Excluding the charge and other special items, Mattel beat estimates with a profit of $10.2 million, or 2 cents a share, contrasted with a year-earlier loss of $3.8 million, or 1 cent a share.

Analysts polled by Thomson Financial/First Call estimated an average loss of 1 cent a share.

Chief Executive Bob Eckert said he generally was pleased with the results.

Shares of Mattel rallied on the news, gaining 90 cents, or 4.5%, to $20.80 on the New York Stock Exchange.

Mattel’s sales rose to $742 million from $715.2 million a year earlier. Gross sales fell 1% in the United States, but rose internationally by 16%, or 20% with the effect of currency exchange rates.

Advertisement