Mattel 2005 Annual Report Download - page 94

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Segment Data
The tables below present information about revenues, income and assets by segment. Mattel does not
include sales adjustments such as trade discounts and other allowances in the calculation of segment revenues
(referred to as “gross sales”). Mattel records these adjustments in its financial accounting systems at the time of
sale to each customer, but the adjustments are not allocated to individual products. For this reason, Mattel’s chief
operating decision maker uses gross sales by segment as one of the metrics to measure segment performance.
Such sales adjustments are included in the determination of segment income from operations based on the
adjustments recorded in the financial accounting systems. Segment income from operations represents operating
income, while consolidated income from operations represents income from operations before income taxes as
reported in the consolidated statements of operations. The corporate and other category includes costs not
allocated to individual segments, including charges related to the financial realignment plan, incentive
compensation and corporate headquarters functions managed on a worldwide basis.
For the Year
2005 2004 2003
(In thousands)
Revenues
Domestic:
Mattel Girls & Boys Brands US ............................ $1,364,922 $1,511,550 $1,594,144
Fisher-Price Brands US ................................... 1,358,562 1,319,200 1,265,224
American Girl Brands .................................... 436,085 379,112 344,446
Total Domestic ............................................. 3,159,569 3,209,862 3,203,814
International ............................................... 2,463,984 2,336,236 2,175,709
Gross sales ................................................. 5,623,553 5,546,098 5,379,523
Sales adjustments ........................................... (444,537) (443,312) (419,423)
Net sales .................................................. $5,179,016 $5,102,786 $4,960,100
Segment Income
Domestic:
Mattel Girls & Boys Brands US ............................ $ 206,496 $ 326,317 $ 388,666
Fisher-Price Brands US ................................... 172,960 173,237 180,133
American Girl Brands .................................... 106,158 77,501 61,968
Total Domestic ............................................. 485,614 577,055 630,767
International ............................................... 316,153 299,224 364,963
801,767 876,279 995,730
Corporate and other expense (a) ................................ 137,238 145,462 210,020
Operating income ........................................... 664,529 730,817 785,710
Interest expense ............................................. 76,490 77,764 80,577
Interest (income) ............................................ (34,211) (19,683) (18,966)
Other non-operating (income), net .............................. (29,799) (23,518) (16,755)
Income before income taxes ................................... $ 652,049 $ 696,254 $ 740,854
(a) Corporate and other expense includes $7.1 million and $16.2 million of charges related to severance for the
years ended December 31, 2005 and 2004, respectively. For 2003, corporate and other expense includes
$26.3 million of charges related to the financial realignment plan and income of $7.9 million representing
an adjustment to a reserve accrued in 1999 associated with the closure of a manufacturing facility in
Beaverton, Oregon.
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