By Uday Sampath Kumar and Deborah Mary Sophia
Reuters – Mattel Inc beat Wall Street estimates for quarterly sales on Wednesday, extending a strong run since the pandemic, as retailers restocked the toymakers Barbie and Hot Wheels brands following inventory shortfalls over the holiday season.
Shipping delays, factory shutdowns and related supply chain snarls had delayed the arrival of many products during the allimportant holiday shopping season, despite companies efforts to pull forward deliveries and reroute goods.
“Following such a strong holiday period, retailers were out of stock, so they restocked more for the first quarter, and still expect to grow in second quarter,” Chief Executive Ynon Kreiz told Reuters.
Shares of the Californiabased toymaker surged as much as 13.4 on Wednesday, following reports of buyout interest from firms including Apollo Global Management Inc and L Catterton.
The second quarter has started strong, Kreiz added, with demand boosted by action figures and games based on major upcoming movies including “Jurassic World: Dominion”, “Lightyear” and “Minions: The Rise of Gru”.
However, the companys gross margin declined 70 basis points from a year earlier, as price hikes failed to cushion the blow from soaring input costs and transportation expenses.
Still, the Uno cards maker reported a net income of 21.5 million, or 6 cents per share, compared to a net loss of 112.4 million, or 32 cents per share, a year earlier.
Overall gross billings for Barbie, Mattels biggest brand, rose 8 in the quarter, while they jumped 31 at Hot Wheels.
Even in a seasonally slow first quarter, net sales surged 19 to 1.04 billion, trouncing analysts average estimate of 918 million, according to Refinitiv IBES.