Mattel 2013 Annual Report Download - page 43

Girl. The North America and International segments sell products in the Mattel Girls & Boys Brands and Fisher-
Price Brands categories, although some are developed and adapted for particular international markets. The 2011
amounts were reclassified to conform to the current presentation. Business segment results should be read in
conjunction with Item 8 “Financial Statements and Supplementary Data—Note 12 to the Consolidated Financial
Statements—Segment Information.”
North America Segment
The following table provides a summary of Mattel’s gross sales by brand for the North America segment for
2012 and 2011:
For the Year
2012 2011 % Change
(In millions, except percentage
information)
Mattel Girls & Boys Brands:
Barbie .......................................................... $ 522.6 $ 543.1 –4%
Other Girls ...................................................... 502.2 340.6 47%
Wheels ......................................................... 394.2 383.4 3%
Entertainment .................................................... 485.0 637.8 –24%
1,904.0 1,904.9 —
Fisher-Price Brands:
Core Fisher-Price ................................................. 919.8 985.6 –7%
Fisher-Price Friends ............................................... 332.5 240.3 38%
Other Fisher-Price ................................................. 157.0 149.9 5%
1,409.3 1,375.8 2%
Other .......................................................... 16.9 16.3
Total Gross Sales ............................................. $3,330.2 $3,297.0 1%
Gross sales for the North America segment were $3.33 billion in 2012, up $33.2 million or 1%, as compared
to $3.30 billion in 2011, with no impact from changes in currency exchange rates. The increase in the
North America segment gross sales was due to higher sales of Other Girls and Fisher-Price Friends products,
partially offset by lower sales of Entertainment products. Of the 47% increase in Other Girls gross sales, 45%
was due to higher sales of Monster High products. Of the 38% increase in Fisher-Price Friends gross sales, 25%
was due to the benefit of licensing revenues from the acquisition of HIT Entertainment, and 21% was due to
higher sales of Disney Jake and the Never Land Pirates products. Of the 24% decrease in Entertainment gross
sales, 22% was due to lower sales of CARS 2 products resulting from the timing of the movie release during
2011. Cost of sales decreased 4% in 2012, as compared to flat net sales, driven primarily by lower product and
other costs and lower royalty expenses, partially offset by higher freight and logistics expenses. Gross margins
increased as a result of favorable product mix, including lower sales of royalty-related entertainment properties,
savings from manufacturing efficiency and Operational Excellence 2.0 programs, and price increases partially
offset by higher input costs and higher customer benefits. Additionally, gross margins were positively impacted
by the acquisition of HIT Entertainment.
North America segment income increased 5% to $810.3 million in 2012, as compared to $770.3 million in
2011, driven primarily by higher gross profit, partially offset by higher other selling and administrative expenses.
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