FOR IMMEDIATE RELEASE CONTACT: Glenn Bozarth April 20, 1994 Mattel, Inc. (310) 524-3521 MATTEL FIRST QUARTER INCOME UP 30 PERCENT ----------------------------------------- LOS ANGELES, April 20 -- Mattel, Inc. today reported record first quarter net income of $24.1 million or $.13 per share, up 30 percent from consolidated Mattel and Fisher-Price earnings of $18.5 million or $.10 per share for the 1993 quarter before accounting changes. Net sales for the quarter were a record $487 million, up 2 percent from $477 million in 1993. First quarter toy sales increased 4 percent, before the negative impact of foreign exchange translation. "These sales and earnings results are in line with our expectations and consistent with our long-term objective of delivering excellent profitable growth," John W. Amerman, Mattel's chairman and chief executive officer, said. "The ability to continue to report record results further demonstrates Mattel's sustainable competitive advantages of core consumer product franchises; an unsurpassed international marketing network; and manufacturing efficiencies resulting from producing the majority of our products in our own facilities. -more- 2-2-2-2-2 "Our first quarter performance, coupled with the rapid integration of Fisher-Price and the expected contribution from the Kransco acquisition, puts us solidly on track to achieve or exceed our 1994 volume and income objectives," Amerman said. Mattel, Inc. is a worldwide leader in the design, manufacture and marketing of children's toys. Fisher-Price, a leader in infant and preschool toys, became part of Mattel through a merger completed in November, 1993. In addition, Mattel expects to complete its acquisition of Kransco by May 31, 1994. Kransco's principal product lines include Power Wheels battery-operated, ride-on vehicles; Hula Hoop and Frisbee products marketed under the Wham-O trademark; and Morey Boogie boards and other water sport toys. With headquarters in El Segundo, California, Mattel has offices and facilities in 34 foreign countries and sells its products in more than 140 nations throughout the world. - # # # - MATTEL, INC. AND SUBSIDIARIES CONSOLIDATED RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED ------------------------- March 31, March 31, (In thousands, except per share amounts) 1994 1993 (a) - ---------------------------------------- ---------- ---------- Net sales $ 487,271 $ 477,184 Cost of sales 249,167 250,481 ---------- ---------- Gross profit 238,104 226,703 Advertising and promotion expenses 71,630 68,489 Other selling and administrative expenses 116,797 117,430 Other expense, net 3,285 560 ---------- ---------- Operating Profit 46,392 40,224 Interest expense 8,123 13,209 ---------- ---------- Income Before Income Taxes 38,269 27,015 Provision for income taxes 14,200 8,535 ---------- ---------- Income Before Cumulative Effect of Changes in Accounting Principles 24,069 18,480 Cumulative effect of changes in accounting principles (b) - (4,022) ---------- ---------- Net Income $ 24,069 $ 14,458 ========== ========== Income Per Share (c) Income before cumulative effect of changes in accounting principles $ 0.13 $ 0.10 Cumulative effect of changes in accounting principles - (0.02) ---------- ---------- Net Income Per Share $ 0.13 $ 0.08 ========== ========== Average Number of Common and Common Equivalent Shares Outstanding 175,037 170,178 ========== ========== MATTEL, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS March 31, March 31, Dec. 31, (In thousands) 1994 1993 (a) 1993 (a) - -------------- ----------- ----------- ----------- ASSETS Cash, cash equivalents and marketable securities $ 201,993 $ 163,091 $ 523,581 Accounts receivable, net 607,448 586,477 580,313 Inventories 244,864 262,562 219,993 Prepaid expenses 145,223 136,911 146,863 ----------- ----------- ----------- Total current assets 1,199,528 1,149,041 1,470,750 Property, plant and equipment, net 333,585 324,677 326,877 Other assets 198,181 199,831 202,450 ----------- ----------- ----------- Total Assets $ 1,731,294 $ 1,673,549 $ 2,000,077 =========== =========== =========== LIABILITIES AND SHAREHOLDERS' EQUITY Notes payable to banks $ - $ 72,426 $ - Current portion of long-term liabilities 4,041 8,897 104,862 Accounts payable and accrued liabilities 386,702 368,898 573,224 Income taxes payable 93,158 40,500 105,243 ----------- ----------- ----------- Total current liabilities 483,901 490,721 783,329 Long-term debt 251,308 268,284 254,159 Other long-term liabilities 75,635 58,618 70,827 Convertible debt - 97,598 73,953 Shareholders' equity 920,450 758,328 817,809 ----------- ----------- ----------- Total Liabilities and Shareholders' Equity $ 1,731,294 $ 1,673,549 $ 2,000,077 =========== =========== =========== <FN> (a) Consolidated results are restated for the merger with Fisher-Price, Inc. (b) A $14.6 million net credit from Mattel's 1/1/93 adoption of FAS Nos. 109 and 106, offset by an $18.6 million net-of-tax charge related to Fisher- Price's adoption of FAS No. 106. (c) Share and per share data for the 1993 first quarter reflect the retroactive effect of shares issued pursuant to the Fisher-Price merger and a 5/4 stock split declared in November 1993.