The holiday shopping season yielded the best end-of-year quarter for Mattel in more than a dozen years after double-digit toy sales surpassed the industry, CEO Ynon Kreiz told Jim Cramer, CNBC , Said Wednesday.
In its fourth-quarter report released after Tuesday’s close, Mattel posted $ 1.6 billion in sales, a 10% increase over the previous quarter. This is the first time the toy maker’s double-digit sales have increased in a holiday quarter since 2006, when the figure rose by more than 14%.
“It was an exceptional quarter for Mattel with our best performance in years with strong consumer demand and another milestone year for the company,” Kreiz said in a “Mad Money” interview.
The performance, which followed double-digit growth in the third quarter, is a sign that the company’s multi-year recovery plan under Kreiz’s leadership is delivering results. He stressed that the company is also improving cash flow.
Mattel had its first year of growth since 2013 when revenue was just $ 6.5 billion. Mattel reported $ 4.58 billion in revenue for the 2020 calendar year, nearly 2% higher than in 2019, and $ 127 million in net revenue, according to FactSet the first profitable year for the company since 2016. The results were better than analysts predict has.
Barbie achieved the best growth of Mattel’s product lines, with sales up 16%.
“It’s not just about the quarter or the year,” said Kreiz, who became CEO in the first half of 2018. ‘It’s about the multi-year strategy that follows very well, which puts us in a strong position to continue to increase profitability and accelerate our growth in 2021 and beyond. ‘
That multi-year strategy contains a list of goals, including restoring profitability and restoring the top line in the short to medium term, while capturing the full value of its intellectual properties in the medium to long term.
Building an online retail and e-commerce strategy, coupled with the production of films involving Mattel brands, is part of the company’s long-term vision.
The company launched a film and television division in 2018 and has more than 50 projects underway, some of which are currently in production and many in the development phase.
Among the projects are an Uno live-action film, a Whac-A-Mole games program and a Thomas & Friends series, Kreiz said.
“It’s part of our medium- to long-term strategy,” Kreiz said. “These projects take time considering the scope and their ambition, but we’re well on track to put them in place, and, you know, they can be successfully transformative.”
In the future, Mattel expects sales to grow to medium to single digits this year, hampering the impact of the coronavirus and other economic uncertainties. The company plans to spend between $ 125 million and $ 150 million on investments and other priorities.
Despite the strong quarterly report, Mattel shares fell 2% to $ 18.47 on Wednesday. To date, the share has been almost 6% higher.