Mattel 2005 Annual Report Download - page 84

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Comprehensive Income
The changes in the components of other comprehensive income, net of tax, are as follows (in thousands):
For the Year
2005 2004 2003
Net income ...................................................... $417,019 $572,723 $537,632
Currency translation adjustments ..................................... (38,767) 36,380 57,847
Minimum pension liability adjustments ............................... (7,243) (1,430) (7,721)
Net unrealized gain (loss) on derivative instruments:
Unrealized holding gains (losses) ................................ 25,348 (33,232) (51,198)
Reclassification adjustment for realized losses included in net income . . . 3,904 31,820 50,220
29,252 (1,412) (978)
Net unrealized (loss) gain on securities:
Unrealized holding (losses) gains ................................ (195) (4,820) 14,300
Reclassification adjustment for realized gains included in net income .... (16,247) (11,539) (9,808)
(16,442) (16,359) 4,492
$383,819 $589,902 $591,272
For 2005, currency translation adjustments resulted in a net loss of $38.8 million, with losses from the
weakening of the Euro and British pound sterling against the US dollar being partially offset by gains from the
strengthening of the Mexican peso against the US dollar. For 2004, currency translation adjustments resulted in a
net gain of $36.4 million, with gains from the strengthening of the British pound sterling, Euro, and Mexican
peso against the US dollar being partially offset by losses from the weakening of the Indonesian rupiah against
the US dollar. For 2003, currency translation adjustments resulted in a net gain of $57.8 million, with gains from
the strengthening of the Euro, British pound sterling, and Hong Kong dollar against the US dollar being partially
offset by losses from the weakening of the Mexican peso against the US dollar.
The components of accumulated other comprehensive loss are as follows (in thousands):
December 31,
2005 2004
Currency translation adjustments .......................................... $(238,559) $(199,792)
Minimum pension liability adjustments ..................................... (68,715) (61,472)
Net unrealized gain on securities .......................................... — 16,442
Net unrealized gain (loss) on derivative instruments ........................... 4,246 (25,006)
$(303,028) $(269,828)
Note 7—Stock Compensation Plans
Mattel Stock Option Plans
In May 2005, Mattel’s stockholders approved the Mattel, Inc. 2005 Equity Compensation Plan (the “2005
Plan”). Upon approval of the 2005 Plan, Mattel terminated its Amended and Restated 1996 Stock Option Plan
(the “1996 Plan”) and its 1999 Stock Option Plan (the “1999 Plan”), except with regard to grants then
outstanding under the 1996 Plan and the 1999 Plan. Restricted stock awards made under the 1996 Plan continue
to vest pursuant to the terms of their respective grant agreements. Outstanding stock option grants under plans
that have expired or have been terminated continue to be exercisable under the terms of their respective grant
agreements. All such stock options expire no later than ten years from the date of grant and generally provide for
vesting over a period of three years from the date of grant. Such stock options generally were granted with
exercise prices equal to the fair market value of Mattel’s common stock on the date of grant, although there are a
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