Mattel 2014 Annual Report Download - page 38

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North America Segment
The following table provides a summary of Mattel’s gross sales by brand for the North America segment for
2014 and 2013:
For the Year
% Change2014 2013
(In millions, except percentage
information)
Mattel Girls & Boys Brands:
Barbie .......................................................... $ 423.6 $ 458.6 –8%
Other Girls ...................................................... 563.1 600.0 –6%
Wheels ......................................................... 337.9 352.0 –4%
Entertainment .................................................... 379.0 454.1 –17%
1,703.6 1,864.7 –9%
Fisher-Price Brands:
Core Fisher-Price ................................................. 682.5 816.7 –16%
Fisher-Price Friends ............................................... 279.7 361.8 –23%
Other Fisher-Price ................................................. 108.3 120.4 –10%
1,070.5 1,298.9 –18%
Construction and Arts & Crafts Brands ............................. 220.5 —
Other .......................................................... 17.0 17.6
Total Gross Sales ............................................. $3,011.6 $3,181.2 –5%
Gross sales for the North America segment were $3.01 billion in 2014, down $169.6 million or 5%, as
compared to $3.18 billion in 2013, with no impact from changes in currency exchange rates. The decrease in the
North America segment gross sales was due to lower sales of Fisher-Price Friends, Entertainment, and Core
Fisher-Price products, partially offset by Construction and Arts & Crafts products. Of the 23% decrease in
Fisher-Price Friends gross sales, 6% was due to lower sales of Nickelodeon products, 5% was due to lower sales
of Thomas and Friends products, 5% was due to lower sales of Disney Jake and the Never Land Pirates products,
and 4% was due to lower sales of Mike the Knight products. Of the 17% decrease in Entertainment gross sales,
6% was due to lower sales of Superman products, 5% was due to lower sales of CARS products, 4% was due to
lower sales of Radica products, and 3% was due to lower sales of Max Steel products. Of the 16% decrease in
Core Fisher-Price gross sales, 6% was due to lower sales of Little People products and 4% 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 increased 3% in 2014, compared to a 7% decrease in net sales, primarily
due to higher product and other costs, partially offset by lower royalty expenses. Gross margins decreased 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 takeaway, the impact of lower sales volume on Mattel’s fixed cost
manufacturing and distribution base, and unfavorable product mix, partially offset by price increases and
Operational Excellence 3.0 savings offset by higher input costs.
North America segment income decreased by 36% to $459.8 million in 2014, as compared to $723.8 million
in 2013, due to lower gross profit and higher other selling and administrative expenses.
32