Mattel 2007 Annual Report Download - page 5

All told, your Board deployed more than $1 billion of
excess cash in 2007
Going forward, we will continue to make strategic acquisitions
when there is a sound fi nancial rationale based on reasonable
expectations and we believe the business can integrate well
with our company. This approach has served us well with the
Radica® Polly Pocket® and Apples to Apples® acquisitions.
We will also return funds to you via dividends, and, from
time to time, share repurchases. Over the past fi ve years, we
have paid shareholders more than $1 billion in dividends and
repurchased $2 billion of our common stock. WE HAVE BEEN
DISCIPLINED AND OPPORTUNISTIC ABOUT DEPLOYING OUR
CAPITAL, AND YOU HAVE OUR COMMITMENT TO CONTINUE
DOING SO IN THE YEARS AHEAD.
In 2008, we are committed to continuing to grow the
business. While many are anxious about consumer
sentiment and potentially choppy economic waters ahead,
the toy business has historically performed relatively well
during tough times. Additionally, on top of our portfolio
of industry leading brands, we expect strong performances
from toys associated with several of this summer’s likely
blockbuster movies: Speed RacerTM Kung Fu PandaTM and
Batman® The Dark KnightTM Our International business
has grown at a double-digit compounded annual growth
rate since the beginning of the decade, and the structure,
management team, plans and programs are in place to
quickly realize our near-term goal of having sales outside
the U.S. contribute more than half of our total revenues.
From a margin perspective, we are experiencing higher
costs this year in many areas, including commodities, labor
and quality testing. While there can always be temporary
dislocations, we are committed to pricing our products
appropriately and reducing controllable costs – just as we did
last year – to address cost pressures and improve profi tability.
We are also committed to exercising our leadership
position in the toy industry. In quality control, for example,
WE’VE DEVELOPED NEW, MORE STRINGENT STANDARDS AND
HAVE OPENLY SHARED THEM WITH OTHER MANUFACTURERS.
We’ve engaged with regulatory bodies around the world
to strengthen systems designed to maintain consumer
confi dence in toys. And we’ve partnered with retailers
to rekindle growth in their toy departments.
WE HAVE CONTINUED OUR COMMITMENT TO STRENGTHEN
OUR EFFORTS AS A RESPONSIBLE CORPORATE CITIZEN
WITH THE CREATION OF A NEW CORPORATE RESPONSIBILITY
ORGANIZATION reporting directly to me. The organization is
tasked with continuing and enhancing the company’s
leadership role in this area by adding a new level of
accountability to Mattel’s safety and compliance protocols;
managing implementation and oversight of the company’s
Global Manufacturing Principles; and coordinating and
progressing green initiatives on a global scale.
We also continue to be committed to the personal and
professional development of our employees. In fact, this year,
FORTUNE MAGAZINE NAMED MATTEL TO THE HIGHLY COVETED
“100 BEST COMPANIES TO WORK FOR” LIST – an acknowledge-
ment of a belief I have had since my very fi rst day on the job.
At the board level, Dean Scarborough, chief executive offi cer
of Avery Dennison, and Vasant Prabhu, chief fi nancial offi cer
of Starwood Hotels, joined Mattel’s Board of Directors,
and we are already benefi ting from their valuable insights.
Tully Friedman, whose leadership we’ve enjoyed for years,
was formally elected lead independent director last May.
Finally, I AM PROUD OF OUR CONTINUED COMMITMENT TO
THE COMMUNITIES IN WHICH WE LIVE, WORK AND PLAY.
This year, the Mattel Children’s Foundation celebrates 30
years of “making a meaningful difference, one child at a
time.” And it was 10 years ago this year that Mattel made
the unprecedented $25 million commitment toward the
building of a new children’s hospital at the University of
California, Los Angeles campus. The Mattel Children’s
Hospital at UCLA opens its doors this spring and expects
to serve more than 100,000 critically ill children each year.
Abraham Lincoln once said: COMMITMENT IS WHAT
TRANSFORMS A PROMISE INTO REALITY. I made a promise
to parents across the globe – that Mattel toys will not only
be great, but also safe. And it is our collective commitment
to you, our shareholders and owners of the company,
that we will make good on that promise as we continue to
realize our vision of being the World’s Premier Toy Brands –
Today and Tomorrow.
Chairman of the Board and Chief Executive Offi cer
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