Mattel 2014 Annual Report Download - page 36

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The following table provides a summary of Mattel’s consolidated gross sales by brand for 2014 and 2013:
For the Year
% Change2014 2013
(In millions, except percentage
information)
Mattel Girls & Boys Brands:
Barbie .......................................................... $1,009.5 $1,202.8 –16%
Other Girls ...................................................... 1,293.5 1,322.8 –2%
Wheels ......................................................... 754.9 747.7 1%
Entertainment .................................................... 839.3 1,042.6 –20%
3,897.2 4,315.9 –10%
Fisher-Price Brands:
Core Fisher-Price ................................................. 1,213.4 1,374.9 –12%
Fisher-Price Friends ............................................... 504.8 608.6 –17%
Other Fisher-Price ................................................. 124.4 137.2 –9%
1,842.6 2,120.7 –13%
American Girl Brands ............................................ 620.7 632.5 –2%
Construction and Arts & Crafts Brands ............................. 315.0 —
Other .......................................................... 42.9 48.7
Total Gross Sales ............................................. $6,718.4 $7,117.8 –6%
Gross sales were $6.72 billion in 2014, down $399.4 million or 6%, as compared to $7.12 billion in 2013,
with an unfavorable impact from changes in currency exchange rates of 2 percentage points. The decrease in
gross sales was due to lower sales of Entertainment, Fisher-Price Friends, Barbie, and Core Fisher-Price
products, partially offset by Construction and Arts & Crafts products. Of the 20% decrease in Entertainment
gross sales, 5% was due to lower sales of Max Steel products, 4% was due to lower sales of Superman products,
4% was due to lower sales of CARS products, and 2% was due to lower sales of kids’ games. Of the 17%
decrease in Fisher-Price Friends gross sales, 6% was due to lower sales of Disney Jake and the Never Land
Pirates products, 4% was due to lower sales of Nickelodeon products, and 3% was due to lower sales of Mike the
Knight®products. The 16% decrease in Barbie gross sales was primarily due to competition within the doll
category and brand propositions that were not compelling enough to consumers. Of the 12% decrease in Core
Fisher-Price gross sales, 4% was due to lower sales of Little People products and 3% was due to lower sales of
Imaginext products. The increase in Construction and Arts & Crafts gross sales was due to initial sales of MEGA
Brands products.
Cost of Sales
Cost of sales as a percentage of net sales was 50.2% in 2014, as compared to 46.4% in 2013. Cost of sales
increased by $16.8 million, or 1%, from $3.01 billion in 2013 to $3.02 billion in 2014, as compared to a 7%
decrease in net sales. Within cost of sales, product and other costs increased by $21.5 million, or 1%, from $2.42
billion in 2013 to $2.44 billion in 2014; royalty expenses decreased $4.5 million, or 2%, from $246.9 million in
2013 to $242.4 million in 2014; and freight and logistics expenses decreased by $0.2 million from $337.3 million
in 2013 to $337.1 million in 2014.
Gross Profit
Gross profit as a percentage of net sales decreased from 53.6% in 2013 to 49.8% in 2014. The decrease in
gross profit as a percentage of net sales was primarily due to the impact of the MEGA Brands acquisition,
including the impact of the inventory fair value markup above historical cost, efforts to improve consumer
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