Mattel shares were mistreated Friday, down more than 15%, the forecast before the annual Toy Fair is a bit dark for investors.
The toy giant's leaders held their annual meeting of analysts in anticipation of the festivities. They told investors that their goal for 2019 was to find more efficiency in profitability, and by 2020 these benefits would be rewarded.
Ynon Kreiz, chairman and CEO of Mattel, detailed his strategy to "unlock growth potential" to turn the company into a high-performing toy company.
Kreiz also said he expects to exceed his overall savings target of $ 650 million.
The company also expects EBITDA of $ 350 million to $ 400 million for the year, well below consensus of $ 551.6 million. It is also expected that gross margin in the '40s and sales growth will be stable over the previous year.
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In the wake of his gloomy prospects, Mattel also revealed Friday to have signed a partnership with MGM for a film based on the brand American Girl. This follows further announcements of recent films, including a Hot Wheels movie and a Barbie movie starring Margot Robbit, an Oscar nominee.
The good news is that Mattel has said its Barbie brand has had five consecutive quarters of year-over-year growth.