Mattel narrows first-quarter loss
By Deborah Adamson, CBS MarketWatch
Last Update: 1:55 PM ET Apr 19, 2000 Also: NewsWatch
EL SEGUNDO, Calif. (CBS.MW) -- Mattel on Wednesday reported a first-quarter loss of 1 cent a share, narrowing its loss from a year ago and beating analysts' expectations.
"I'm positively surprised," said Sean McGowan, an analyst at Gerard Klauer Mattison & Co.
The toymaker (MAT: news, msgs) lost $6.2 million on continuing operations and before $38.4 million in after-tax severance costs. Analysts polled by First Call expected a loss of 3 cents. Last year, Mattel lost $12.6 million, or 3 cents a share.
Mattel did not include losses from its software unit, primarily The Learning Co., in the quarter. That loss was treated as part of discontinued operations, since the toymaker is seeking a buyer for the division.
Including the unit and other extraordinary items, El Segundo, Calif.-based Mattel incurred a net loss of $171.2 million, or 40 cents a share. Last year, net income was $3 million, or 1 cent, which didn't include the troubled Learning Co.
Sales were $693.3 million vs. $688.3 million.
McGowan said he's heard Mattel is "getting quite close" to selling The Learning Co. The leading candidate, he believes, is Havas Interactive, a publisher of educational and entertainment software and CD-ROMs. It's owned by Havas SA of France.
He expects Mattel to sell the software unit for between $500 million to $1 billion, but closer to the low-end of the range. Mattel bought the unit for $3.5 billion about a year ago.
During the quarter, Barbie sales were up 7 percent globally. Sales of its infant and preschool lines were up 2 percent. Revenue from its Wheels products -- including Hot Wheels, Matchbox and Tyco R/C -- were down 4 percent globally. However, toys in its entertainment category recorded a sales increase of 14 percent overall.
Shares of Mattel were up 1/16 to 11 13/16 in recent trading. |
