Barbie and Hot Wheels grow but Q1 revenue still drops as Mattel laments the ‘Toys R Us effect’

Sales of Barbie and Hot Wheels are on the rise, yet toymaker Mattel is still the latest to blame Toys R Us for its sliding first quarter sales figures.

Mattel has stated that the liquidation of the US toy retailer has presented a ‘near term challenge’ to the company that welcomed in its new chief executive this week.

Mattel has reported revenue of $708.4m for the first quarter of the year, down four per cent from $735.6m last year. The company also delivered a net loss of $311.3m, 43.9 per cent deeper than the $113.2m loss a year ago.

Despite the loss, results have beaten analysts’ expectations of a net loss of $145.8m, while Barbie and Hot Wheels segments both saw double-digit growth during the quarter.

Fisher-Price and Thomas & Friends lines registered declines in the mid-single digits.

The bankruptcy of Toys R Us has removed a key sales channel for Mattel, among other manufacturers who has already endured a tough past six months and weaker than expected performances over the Christmas trading season.

The manufacturer is also seeing out a reshuffle in management and executive ranks. Ynon Kreiz, a director at Mattel since June, took the reins as chief executive this week, replacing Margo Georgiadis who announced earlier this month she was stepping down.

Kreiz said in a statement on Thursday afternoon that, excluding the Toys R Us liquidation, Mattel delivered positive sales growth in the first quarter and sees “strong momentum” in key brands like Barbie.

“While Toys R Us will present a near term challenge, our transformation plan remains our focus, as we work to deliver improved profitability and return Mattel to its leadership position as a high-performing toy company,” he said.

Mattel last year reportedly rebuffed a takeover approach from Hasbro, and speculation about a tie-up has continued to swirl this year.

About Robert Hutchins

Robert Hutchins is the editor of ToyNews and its sister title, Licensing.biz. He has worked his way from Staff Writer to Editor across the two titles, having spent almost eight years with both and what now seems like a lifetime surrounded by toys. You can contact him by emailing robert.hutchins@biz-media.co.uk or calling him on 0203 143 8780 You can even follow him on Twitter @RobGHutchins if ranting is your thing...

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