Mattel 2013 Annual Report Download - page 50

Commitments
In the normal course of business, Mattel enters into debt agreements and contractual arrangements to obtain
and protect Mattel’s right to create and market certain products and for future purchases of goods and services to
ensure availability and timely delivery. These arrangements include commitments for future inventory and
service purchases and royalty payments pursuant to licensing agreements. Certain of these commitments
routinely contain provisions for guarantees or minimum expenditures during the terms of the contracts. Mattel
also has defined benefit and postretirement benefit plans, which require future cash contributions and benefit
payments. Additionally, Mattel routinely enters into noncancelable lease agreements for premises and equipment
used, which contain minimum rental payments.
The following table summarizes Mattel’s contractual commitments and obligations:
Total 2014 2015 2016 2017 2018 Thereafter
(In millions)
Long-term debt ...................... $1,600.0 $ — $ — $300.0 $ — $250.0 $1,050.0
Interest on long-term debt .............. 1,054.8 62.4 62.4 61.1 54.9 51.5 762.5
Capital leases* ....................... 1.8 0.3 0.3 0.3 0.3 0.3 0.3
Operating leases ...................... 544.5 103.9 89.4 82.4 60.9 44.3 163.6
Minimum guarantees under licensing and
similar agreements .................. 208.8 67.4 78.6 42.3 18.9 1.0 0.6
Defined benefit and postretirement benefit
plans ............................. 430.4 56.3 38.7 45.3 37.1 38.4 214.6
Purchases of inventory, other assets, and
services .......................... 383.3 361.9 15.8 4.5 1.1 — —
Total ............................... $4,223.6 $652.2 $285.2 $535.9 $173.2 $385.5 $2,191.6
* Represents total obligation, including imputed interest of $0.4 million.
Liabilities for uncertain tax positions for which a cash tax payment is not expected to be made in the next
twelve months are classified as other noncurrent liabilities. Due to the uncertainty about the periods in which
examinations will be completed and limited information related to current audits, Mattel is not able to make
reasonably reliable estimates of the periods in which cash settlements will occur with taxing authorities for the
noncurrent liabilities.
Subsequent Event
On January 31, 2014, Mattel announced that its Board of Directors declared a first quarter dividend of
$0.38 per common share. The dividend is payable on March 7, 2014 to stockholders of record on February 20,
2014.
Litigation
The content of Item 8 “Financial Statements and Supplementary Data—Note 11 to the Consolidated
Financial Statements—Commitments and Contingencies—Litigation” is hereby incorporated by reference in this
Item 7.
Effects of Inflation
Inflation rates in the US and in major foreign countries where Mattel does business have not had a
significant impact on its results of operations or financial position during 2013, 2012, or 2011. Mattel receives
some protection from the impact of inflation from high turnover of inventories and its ability, under certain
circumstances and at certain times, to pass on higher prices to its customers.
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