Mattel 2010 Annual Report Download - page 45

Financial Position
Mattel’s cash and equivalents were $1.28 billion at December 31, 2010, an increase of $164.1 million from
2009. The increase was primarily driven by net proceeds received from the $500.0 million issuance of senior
notes in September 2010, the timing and amount of accounts payable and accrued liabilities payments, and
proceeds received from the exercise of stock options. The increase was partially offset by seasonal increases in
accounts receivable and inventory, $446.7 million of share repurchases, $291.3 million of dividend payments,
and $136.7 million of purchases of tools, dies, and molds, and other property, plant, and equipment.
Accounts receivable increased $396.8 million from December 31, 2009 to $1.15 billion at December 31,
2010, driven primarily by the decision not to factor $300 million of domestic receivables in 2010, as well as
increased sales volume.
Inventories increased $108.2 million from December 31, 2009 to $463.8 million at December 31, 2010,
driven primarily by the rebuild of inventory to support point of sale momentum and improve customer service
levels, as compared to a significant liquidation of inventories in 2009 due to economic uncertainty.
Accounts payable and accrued liabilities increased $79.9 million from December 31, 2009 to $1.05 billion at
December 31, 2010, primarily due to the timing and amount of payments of accounts payable and various
accrued liability balances, including advertising and royalty obligations.
At December 31, 2010 and 2009, Mattel’s total short-term borrowings totaled $0 and $2.0 million,
respectively. The current portion of long-term debt increased $200.0 million to $250.0 million at December 31,
2010, as compared to $50.0 million at December 31, 2009 due to the reclassification of $200.0 million of 2006
Senior Notes and $50.0 million of Medium-term notes from noncurrent to current, offset by $50.0 million of
scheduled repayments of Medium-term notes in May and October 2010.
A summary of Mattel’s capitalization is as follows:
December 31,
2010 2009
(In millions, except percentage
information)
Medium-term notes .............................................. $ 100.0 2% $ 150.0 4%
2006 Senior Notes ............................................... — — 200.0 5
2008 Senior Notes ............................................... 350.0 9 350.0 10
2010 Senior Notes ............................................... 500.0 12 — —
Total noncurrent long-term debt .................................... 950.0 23 700.0 19
Other noncurrent liabilities ........................................ 488.9 12 488.7 13
Stockholders’ equity ............................................. 2,628.6 65 2,531.0 68
$4,067.5 100% $3,719.7 100%
Total noncurrent long-term debt increased $250.0 million at December 31, 2010, as compared to
December 31, 2009, due primarily to the $500.0 million issuance of senior notes in September 2010, partially
offset by the reclassification of $200.0 million of 2006 Senior Notes and $50.0 million of Medium-term notes to
current. Mattel expects to satisfy its future long-term capital needs through the generation of corporate earnings
and issuance of long-term debt instruments, as needed.
Stockholders’ equity of $2.63 billion at December 31, 2010 increased $97.6 million from December 31,
2009, primarily as a result of net income, partially offset by share repurchases during 2010 and payment of the
annual dividend on common stock in the fourth quarter of 2010.
Mattel’s debt-to-capital ratio, including short-term borrowings and the current portion of long-term debt,
increased to 31.3% at December 31, 2010 from 22.9% at December 31, 2009, due to the $500.0 million issuance
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