Mattel 2001 Annual Report Download - page 5

Download and view the complete annual report

Please find page 5 of the 2001 Mattel annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 99

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99

decreased by 40 basis points, excluding
the bad debt expense related to Kmart
Corporation’s bankruptcy filing. (Printing
this report in conjunction with our Form
10-K is just one example among hundreds
of projects to lower overhead costs.) As
a result, operating profit advanced
15 percent and
represented 13.3
percent of sales.
Worldwide income
from continuing operations was $351.6
million or $0.81 per share, excluding
restructuring and non-recurring charges.
This represents 20 percent growth from
$293.3 million or $0.69 per share in 2000.
Including restructuring and non-recurring
charges, full-year earnings per share from
continuing operations were $0.71, com-
pared to $0.40 in 2000.
Most encouragingly, as a result of our
strong cash flow from operations in
2001, we ended the year with more than
$600 million in cash, an increase of more
than $380 million from the prior year. We
also reduced debt by more than $230 million.
Year-end debt as a percentage of total capi-
tal was 42 percent, down from 52 percent
at year-end 2000. This puts us well on our
way to achieving our stated long-term
objective of having debt represent approxi-
mately one-third of total capital.
While delivering on our near-term financial
objectives, we also made investments
aimed at ensuring a strong future. We
invested in manufacturing capacity in
Mexico to absorb
production from our
Kentucky plant,
which will cease
operations this year
as part of a phased
closure. We improved
efficiencies by moving
more product designers
and engineers closer to production locations.
We developed and have begun executing
a three-year plan to fully integrate and
upgrade our information systems and
technology infrastructure. We have added
warehouse and office space in China to
capitalize on the region’s structural cost
advantages.
We also acquired
Pictionary, Inc., the
owner of the
Pictionary®board
game, obtained a
license for the
rights to Barney™,
and renewed our global alliance with
Sesame Workshop®and our license for
the Disney character brands. Licensing
agreements with Vivendi Universal
Publishing and THQ also were finalized to
extend our core brands, including Barbie®
and Hot Wheels®, to console games and
personal computers.
Most importantly, we have invested in the
people of Mattel, whose talents provide
We are on track to realize
the full $200 million in
savings that we projected.
3