Mattel 2010 Annual Report Download - page 35

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Worldwide gross sales of Mattel Girls & Boys Brands increased 11% to $3.66 billion in 2010, including
unfavorable changes in currency exchange rates of 3 percentage points. Domestic gross sales of Mattel Girls &
Boys Brands increased 16% and international gross sales increased 8%, including unfavorable changes in
currency exchange rates of 4 percentage points. Worldwide gross sales of Barbie®increased 7%, including
unfavorable changes in currency exchange rates of 2 percentage points. Domestic gross sales of Barbie®
increased 14% and international gross sales increased 2%, including unfavorable changes in currency exchange
rates of 5 percentage points. Worldwide gross sales of Other Girls Brands increased 16%, including unfavorable
changes in currency exchange rates of 2 percentage points, driven primarily by increased sales of Disney
Princess™products and the launch of Monster High®. Worldwide gross sales of Wheels products decreased 2%,
including unfavorable changes in currency exchange rates of 1 percentage point, driven primarily by decreased
sales of Tyco R/C®products and other Wheels products that did not continue into 2010, partially offset by
increased sales of Hot Wheels®products. Worldwide gross sales of Hot Wheels®increased 3%, including
unfavorable changes in currency exchange rates of 1 percentage point. Worldwide gross sales of Entertainment
products increased 27%, including unfavorable changes in currency exchange rates of 4 percentage points, driven
primarily by increased sales of Toy Story®3, WWE®Wrestling, and Radica®products.
Worldwide gross sales of Fisher-Price Brands increased 2% to $2.22 billion in 2010, including unfavorable
changes in currency exchange rates of 2 percentage points. Domestic gross sales of Fisher-Price Brands increased
3% and international gross sales increased 1%, including unfavorable changes in currency exchange rates of 4
percentage points. Worldwide gross sales of Core Fisher-Price®decreased 3%, including unfavorable changes in
currency exchange rates of 2 percentage points. Domestic gross sales of Core Fisher-Price®decreased 2% and
international gross sales decreased 3%, including unfavorable changes in currency exchange rates of 3 percentage
points. Worldwide gross sales of Fisher-Price®Friends increased 24%, including unfavorable changes in
currency exchange rates of 2 percentage points, driven primarily by sales of products supporting the
Thomas and Friends®property and the launch of Sing-a-ma-jigs™, partially offset by decreased sales of Sesame
Street®and certain smaller licensed properties products. Domestic gross sales of Fisher-Price®Friends increased
29% and international gross sales increased 17%, including unfavorable changes in currency exchange rates of 6
percentage points.
American Girl Brands gross sales increased 5% to $486.6 million in 2010, driven primarily by sales of
Lanie®, the 2010 Girl of the Year®doll, and Felicity®dolls, the benefit of two new American Girl®stores in
Lone Tree, Colorado and Overland Park, Kansas, and the launch of the American Girl®virtual world.
Cost of Sales
Cost of sales as a percentage of net sales was 49.5% in 2010, as compared to 50.0% in 2009. Cost of sales
increased by $185.1 million, or 7%, from $2.72 billion in 2009 to $2.90 billion in 2010, as compared to an 8%
increase in net sales. Within cost of sales, freight and logistics expenses increased by $17.8 million, or 6%, from
$295.9 million in 2009 to $313.7 million in 2010; royalty expense increased $57.4 million, or 30%, from $188.5
million in 2009 to $245.9 million in 2010; and other product costs increased by $109.9 million, or 5%, from
$2.23 billion in 2009 to $2.34 billion in 2010
Gross Profit
Gross profit as a percentage of net sales increased from 50.0% in 2009 to 50.5% in 2010, driven primarily
by effective pricing and net cost savings related to the Global Cost Leadership program, partially offset by higher
royalty expense as a result of increased sales of products tied to licensed properties.
Advertising and Promotion Expenses
Advertising and promotion expenses decreased to 11.1% of net sales in 2010, as compared to 11.2% of net
sales in 2009.
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