Bryan Stockton Resigns as Chairman and Chief Executive Officer
Company Announces Preliminary Fourth Quarter and Full Year 2014
Company Announces Quarterly Dividend
EL SEGUNDO, Calif.--(BUSINESS WIRE)--
Mattel, Inc. (NASDAQ: MAT) today announced that Christopher A. Sinclair
has been named the Company's Chairman and Interim Chief Executive
Officer, effective immediately. The Company also announced that Bryan G.
Stockton has resigned as Mattel's Chairman and Chief Executive Officer
and resigned from the Board of Directors.
Mr. Sinclair, who has served as a member of Mattel's Board of Directors
since 1996 and as Independent Lead Director since 2011, has extensive
experience in leading global, multi-brand, consumer-focused companies.
In addition to leadership roles at prominent venture capital and private
equity firms, Mr. Sinclair was Chairman and CEO of Caribiner
International, Inc. from 1999-2000, President and CEO of Quality Food,
Inc. from 1996-1998, and prior to that served in senior roles at
PepsiCo, including as Chairman and CEO of Pepsi-Cola Company, and
President and CEO of PepsiCo Foods & Beverages International and
Pepsi-Cola International. He also served as Chair of Mattel's Audit
"Mattel is an exceptional company with a great future but the Board
believes that it is the right time for new leadership to maximize its
potential," said Mr. Sinclair. "We are committed to delivering improved
growth and financial performance and remain confident in our ability to
leverage our unmatched portfolio of brands, global scale and strong
balance sheet as we execute on our strategic plan. I look forward to
engaging with the entire Mattel community as we work to deepen our
connections with children and parents through expanded product
innovation and improved retail execution. We will be working during the
coming months to revitalize the business and to identify the right
leadership for Mattel as it enters its next phase of growth and value
Mr. Sinclair continued, "On behalf of the Board and everyone at Mattel,
I sincerely thank Bryan for his many valuable contributions over the
past 15 years in expanding our business and portfolio of brands and
building our executive team."
Preliminary Fourth Quarter and Full Year 2014 Financial Results
Mattel also announced preliminary fourth quarter and full year 2014
For the fourth quarter, the Company reported net income of $149.9
million, or $0.44 per share, which includes a negative impact of $0.05
per share from MEGA Brands integration costs1 and a negative
tax impactof $0.03 per share, compared to net income of
$369.2 million, or $1.07 per share, in the fourth quarter of 2013.
Worldwide net sales in the fourth quarter were $1.99 billion, down 6%,
including an unfavorable impact from changes in currency exchange rates
of 3 percentage points, compared to $2.11 billion last year. Gross
margin decreased by 410 basis points of net sales to 50.4%, which was
partially due to the acquisition of MEGA Brands. SG&A expenses increased
by 390 basis points of net sales, including the impact of the
acquisition of MEGA Brands. Operating income for the quarter was $237.0
million compared to $479.3 million in the fourth quarter of 2013.
For the year, the Company reported net income of $498.9 million, or
$1.45 per share, which includes a negative impact of $0.16 per share
from MEGA Brands acquisition and integration costs2 and a tax
benefit of $0.13 per share, compared to net income of $903.9 million, or
$2.58 per share, in 2013, which included a tax benefit of $0.09.
Worldwide net sales were $6.02 billion, down 7%, including an
unfavorable impact from changes in currency exchange rates of 2
percentage points, compared to $6.48 billion last year. Gross margin
decreased by 380 basis points of net sales to 49.8%, which was partially
due to the acquisition of MEGA Brands. SG&A expenses increased by 270
basis points of net sales, including the impact of the acquisition of
MEGA Brands. Operating income for the year was $653.7 million compared
to $1.17 billion in 2013.
For the year, net cash flows from operating activities were
approximately $889 million, an increase of $191 million over
approximately $698 million in 2013. The increase was primarily driven by
reductions in working capital, partially offset by lower net income. The
Company ended the year with cash of $971.7 million, which is consistent
with our capital and investment framework target of $800 million to $1
billion of year-end cash. The Company's debt-to-total capital ratio as
of December 31, 2014 was 41.6%.
The Company announced today a first quarter cash dividend of $0.38 per
share which is flat compared to the first quarter of 2014. The dividend
will be payable on March 6, 2015 to stockholders of record on February
Conference Call and Live Webcast
As previously announced, the Company plans to release its fourth quarter
and year-end financial results for the 2014 fiscal year on Friday,
January 30, 2015 at approximately 6:00 a.m. Eastern time. Following
this, Christopher A. Sinclair, Mattel's Interim CEO, and Kevin Farr, the
Company's CFO, will host a conference call and webcast at 8:30 a.m.
The fourth quarter financial results conference call will be webcast on
the "Investors" section of Mattel's corporate website, http://corporate.mattel.com.
To listen to the live call, log on to the website at least 15 minutes
early to register, download and install any necessary audio software. An
archive of the webcast will be available on the Company's website for 90
days and may be accessed beginning two hours after the completion of the
live call. A telephonic replay of the call will be available beginning
at 11:30 a.m. Eastern time the morning of the call until Friday,
February 6, 2015, and may be accessed by dialing +1-404-537-3406. The
passcode is 61570566.
Information required by Securities and Exchange Commission Regulation G,
regarding non-GAAP financial measures, as well as other financial and
statistical information, will be available at the time of the webcast on
the "Investors" section of http://corporate.mattel.com,
under the sub-heading "Financial Information."
Christopher A. Sinclair Biography
Christopher Sinclair, 64, has served on Mattel's Board of Directors
since 1996 and as Independent Lead Director and Chair of the Audit
Committee since 2011. Mr. Sinclair has served as Executive Chairman of
Scandent Holdings, an information technology investment company, from
2002-2009, and also served as Executive Chairman of Cambridge Solutions
Corporation Ltd., a leader in providing information technology and
business process outsourcing services, from 2005-2009. Prior to that, he
served as an Operating Partner of Pegasus Capital Advisors, LP, a
private equity firm, from 2000-2002. From 1999-2000, he served as
Chairman of the Board and Chief Executive Officer of Caribiner
International, Inc. Earlier, he served as President and Chief Executive
Officer of Quality Food, Inc., Chairman and Chief Executive Officer of
Pepsi-Cola Company and President and Chief Executive Officer of PepsiCo
Foods & Beverages International and Pepsi-Cola International.
Mr. Sinclair recently joined the board of RB (Reckitt Benckiser Group
PLC). He has also served on the Board of Directors of Foot Locker, Inc.
from 1995-2008, where he was Chairman of the Finance Committee and a
member of the Compensation Committee, Cambridge Solutions Corporation,
Ltd. from 2003-2009, and Perdue Farms from 1992-2000.
Mr. Sinclair was born and raised in Asia. He holds a bachelor's degree
in Business Administration from the University of Kansas and an MBA from
the Tuck School of Business at Dartmouth College.
The Mattel family of companies (Nasdaq: MAT) is the worldwide leader in
the design, manufacture and marketing of toys and family products.
Mattel's portfolio of best-selling brands includes Barbie®, the most
popular fashion doll ever produced, Hot Wheels®, Monster High®, American
Girl®, Thomas & Friends® and Fisher-Price® brands, including Little
People® and Power Wheels®, MEGA® Brands, including MEGA BLOKS® and
RoseArt®, as well as a wide array of entertainment-inspired toy lines.
In 2013, Mattel was named one of the "World's Most Ethical Companies" by
Ethisphere Magazine and in 2014 ranked No. 5 on Corporate Responsibility
Magazine's "100 Best Corporate Citizens" list. With worldwide
headquarters in El Segundo, Calif., Mattel's companies employ nearly
30,000 people in 40 countries and territories and sell products in more
than 150 nations. At Mattel, we are Creating the Future of Play. Visit
us at www.mattel.com,
This press release contains forward-looking statements on a variety of
matters. These forward-looking statements are based on currently
available operating, financial, economic and other information and are
subject to a number of significant risks and uncertainties. A variety of
factors, many of which are beyond our control, could cause actual future
results to differ materially from those projected in the forward-looking
statements. Some of these factors are described in the Company's
periodic filings with the Securities and Exchange Commission, including
the "Risk Factors" section of Mattel's Annual Report on Form 10-K for
the fiscal year ended December 31, 2013 and Mattel's Quarterly Reports
on Form 10-Q for fiscal year 2014, as well as in Mattel's other public
statements. Mattel does not update forward-looking statements and
expressly disclaims any obligation to do so.
1 Includes amortization of acquired intangible assets.
Includes amortization of acquired intangible assets and inventory fair
value markup above cost.
Alex Clark, 310-252-6397
Drew Vollero, 310-252-2703
Source: Mattel, Inc.
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