Mattel 2011 Annual Report Download - page 106

Segment Data
The following tables 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 incentive compensation, share-based payments, and
corporate headquarters functions managed on a worldwide basis, and the impact of changes in foreign currency
rates on intercompany transactions.
For the Year
2011 2010 2009
(In thousands)
Revenues
Domestic:
Mattel Girls & Boys Brands US ............................ $1,775,954 $1,626,407 $1,402,224
Fisher-Price Brands US ................................... 1,293,780 1,352,729 1,310,886
American Girl Brands .................................... 510,936 486,644 462,899
Total Domestic ............................................. 3,580,670 3,465,780 3,176,009
International ............................................... 3,260,417 2,920,830 2,758,315
Gross sales ................................................. 6,841,087 6,386,610 5,934,324
Sales adjustments ........................................... (575,050) (530,415) (503,478)
Net sales .................................................. $6,266,037 $5,856,195 $5,430,846
Segment Income
Domestic:
Mattel Girls & Boys Brands US ............................ $ 483,530 $ 409,445 $ 293,366
Fisher-Price Brands US ................................... 161,652 222,046 231,855
American Girl Brands .................................... 113,058 112,923 103,446
Total Domestic ............................................. 758,240 744,414 628,667
International ............................................... 619,278 531,003 422,505
1,377,518 1,275,417 1,051,172
Corporate and other expense (a) ................................ (336,417) (373,515) (320,004)
Operating income ........................................... 1,041,101 901,902 731,168
Interest expense ............................................. 75,332 64,839 71,843
Interest (income) ............................................ (8,093) (8,434) (8,083)
Other non-operating expense (income), net ....................... 3,189 (1,328) 7,361
Income before income taxes ................................... $ 970,673 $ 846,825 $ 660,047
(a) Corporate and other expense includes (i) incentive compensation expense of $75.3 million, $106.7 million,
and $96.6 million for 2011, 2010, and 2009, respectively, (ii) $14.9 million, $21.0 million, and $31.5 million
of charges related to severance and other termination-related costs for 2011, 2010, and 2009, respectively,
(iii) share-based compensation expense of $53.5 million, $67.1 million, and $50.0 million for 2011, 2010,
and 2009, respectively, (iv) charges to establish a legal settlement reserve for product liability-related
litigation totaling $27.4 million for 2009, a reduction to the legal settlement reserve of $8.7 million for
2010, and benefits from insurance recoveries of costs incurred in connection with product liability-related
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