Toy manufacturer Mattel has completed the upgrade
Last week, toy manufacturer Mattel Inc. (MAT) announced the results of the fourth quarter of 2021 and presented a positive outlook for the current period. According to management, the return to growth is a consequence of Mattel’s modernization. So now the company will be in “Growth Mode.”
Despite short-term economic obstacles, Mattel’s fourth-quarter sales increased by up to 10%. Management’s cost-cutting initiatives have yielded robust net income figures: adjusted earnings per share increased by 33%. The toy industry has been growing for about ten years in a row, and sales have remained stable pandemics. The most popular brands – Hot Wheels and Barbie – helped Mattel gain a larger share of the global market in the doll category in 2021.
Management expects more growth in 2022. According to the forecast, sales will grow by 8-10% year-on-year, and adjusted earnings per share will improve to a range of $1.42 to $1.48. This year, Mattel expects strong growth from its core brands (Hot Wheels, Barbie, and Thomas & Friends) and toys associated with popular franchises such as Jurassic World and Buzz Lightyear.
Mattel’s strengths are marketing and doll design, and several upcoming releases serve as powerful growth catalysts. For example, Mattel intends to revive the production of dolls from the once top-rated Monster High series and start producing dolls based on the “Cold Heart” franchise, which became possible after signing a contract with Walt Disney. Mattel suggests that these innovations will increase sales and strengthen profit indicators in the coming years.
