Toy maker Mattel makes a profit despite a drop in sales, Consumer

Fri 26 Oct 2018 – 6:48

[NEW YORK] Mattel announced a further decline in quarterly sales on Wednesday, in part because of China's weakness, but its shares rose after Barbie doll maker made a profit as a result of cost-cutting initiatives.

In the third quarter, the profits of the manufacturer company fell by $ 6.3 million, compared with a loss of $ 603.3 million for the same period of the previous year.

Revenues decreased 7.9% to US $ 1.4 billion.

Mattel CEO Ynon Kreiz, who took the leading position in April, said operating profits had increased after the cost reductions showed the company was "on the road to implementation of our strategy ".

"We have continued to make progress in restructuring our organization," he said.

The company, which announced in July its intention to cut 2,200 jobs, is currently exploring ways to move to a more "capitalist" manufacturing model and create a new movie theater division, Kreiz said.

Mattel's iconic line of Barbie dolls was by far the best-performing franchise, recording a 14% increase in global sales compared to the same period of the previous year.

But other key products such as Hot Wheels, Thomas & Friends and American Girl have all seen a drop in sales.

Weak sales in China and the successful liquidation of the Toys "R" Us store contributed to the drop in sales, the company said.

Shares jumped 6.6% to $ 14.75 in after-hours trading.

AFP