Mattel 2009 Annual Report Download - page 38

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Sales
Net sales for 2009 were $5.43 billion, an 8% decrease as compared to $5.92 billion in 2008, including
unfavorable changes in currency exchange rates of 2 percentage points. Gross sales within the US decreased 4%
from 2008, and accounted for 54% and 51% of consolidated gross sales in 2009 and 2008, respectively. Gross
sales in international markets decreased 13% as compared to 2008, including unfavorable changes in currency
exchange rates of 4 percentage points.
Worldwide gross sales of Mattel Girls & Boys Brands decreased 10% to $3.29 billion in 2009 as compared
to 2008, including unfavorable changes in currency exchange rates of 3 percentage points. Domestic gross sales
of Mattel Girls & Boys Brands decreased 2% and international gross sales of Mattel Girls & Boys Brands
decreased 15%, including unfavorable changes in currency exchange rates of 4 percentage points. Worldwide
gross sales of Barbie®decreased 3%, including unfavorable changes in currency exchange rates of 3 percentage
points. Domestic gross sales of Barbie®increased 4% and international gross sales of Barbie®decreased 6%,
including unfavorable changes in currency exchange rates of 4 percentage points. Worldwide gross sales of Other
Girls Brands decreased 20%, including unfavorable changes in currency exchange rates of 2 percentage points,
driven primarily by sales declines in High School Musical®products. Worldwide gross sales of Wheels products
decreased 7%, including unfavorable changes in currency exchange rates of 3 percentage points, primarily due to
sales declines in Speed Racer®and Tyco R/C®products, partially offset by higher sales of Core Hot Wheels®
and Matchbox®products. Worldwide gross sales of Entertainment products decreased by 14%, including
unfavorable changes in currency exchange rates of 2 percentage points, driven primarily by sales declines in
Radica®products and products tied to last year’s three key summer movie properties: Batman®, Speed Racer®,
and Kung Fu Panda®, partially offset by sales of products tied to Toy Story®and Toy Story®2, and higher sales
of CARS™ products domestically.
Worldwide gross sales of Fisher-Price Brands decreased 8% to $2.17 billion in 2009 as compared to 2008,
including unfavorable changes in currency exchange rates of 1 percentage point. Domestic gross sales of Fisher-
Price Brands decreased 8% and international gross sales decreased 9%, including unfavorable changes in currency
exchange rates of 4 percentage points. Worldwide gross sales of Core Fisher-Price®decreased 6%, including
unfavorable changes in currency exchange rates of 1 percentage point. Domestic gross sales of Core Fisher-Price®
decreased 4% and international gross sales decreased 9%, including unfavorable changes in currency exchange rates
of 4 percentage points. Worldwide gross sales of Fisher-Price®Friends decreased 13%, with no impact from
changes in currency exchange rates. Domestic gross sales of Fisher-Price®Friends decreased 18% and international
gross sales decreased 5%, with no impact from changes in currency exchange rates.
American Girl Brands gross sales were flat during 2009 as compared to 2008, driven primarily by the
November 2008 openings of the American Girl Boutique and Bistro®in Boston and Minneapolis, offset by
softness resulting primarily from a difficult comparison to strong entertainment-related sales in 2008.
Cost of Sales
Cost of sales decreased by $517.4 million, or 16%, from $3.23 billion in 2008 to $2.72 billion in 2009 as
compared to an 8% decrease in net sales. On an overall basis, cost of sales decreased from 2008 primarily due to
lower sales volume, cost savings from Mattel’s Global Cost Leadership program, and lower input costs. Within
cost of sales, product costs decreased by $366.5 million, or 14%, from $2.60 billion in 2008 to $2.23 billion in
2009; freight and logistics expenses decreased by $98.2 million, or 25%, which included net cost savings from
the Global Cost Leadership program, from $394.1 million in 2008 to $295.9 million in 2009; and royalty expense
decreased $52.7 million, or 22%, from $241.2 million in 2008 to $188.5 million in 2009.
Gross Profit
Gross profit as a percentage of net sales increased from 45.4% in 2008 to 50.0% in 2009. The increase in
gross profit as a percentage of net sales was primarily driven by price increases and net cost savings related to the
Global Cost Leadership program, partially offset by unfavorable changes in currency exchange rates.
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