Mattel revealed that its focus this year is its transformation efforts, adding up to its success of reaching consumers on multiple platforms including its new direct-to-consumer offerings.
Mattel Inc (NASDAQ: MAT) saw its shares rise as much as 4% on February 24 and closed with a 1% increase after the company revealed its forecasts for 2021 and beyond in its Virtual Analyst Meeting. Although Mattel has been holding virtual press and retailer presentations to launch new games and toys for 2021, its virtual analyst meeting was a digital replacement for its annual in-person event that usually takes place at Toy Fair New York.
Mattel, after revealing its Q4 performance and full-year 2020 earnings earlier in the month, has now provided their financial outlook for this year and beyond. The American multinational toy manufacturing company expects its adjusted EBITDA to fall in between $775 million and $800 million this year, which would be a rise from the $719 million they had last year.
Mattel is also eyeing a fruitful year as it anticipates its revenue growing in the mid-single digits up from the $4.58 billion seen in 2020, adding that they see sales growing at a similar pace in 2022 and 2023. The company revealed it expects cost savings of $250 million by 2023. Mattel cut costs by $1 billion between 2018 and 2020.Matt also expects the operating income margin to stay in the mid-teens through 2023.
The company revealed that its focus this year is its transformation efforts, adding up to its success of reaching consumers on multiple platforms including its new direct-to-consumer offerings. Mattel added that its overall progress is centered around its transformation effort and also highlighted its growth in community outreach, sustainability and diversity.
Ynon Kreiz, CEO of the company has initiated a multi year strategy in a bid to restore profitability and rejuvenate its annual gross sales since he took over in 2018. Kreiz has directed his focus to the company’s online and e-commerce unit as well as a film strategy which will see different Mattel brands and products showcased in them. Mattel’s e-commerce sales were up 50% last year.
Mattel now has a film and television division, created by Kreiz as one of his first decisions after taking over as CEO. The division currently boasts of over 50 projects in the works which includes an Uno live-action film starring Margot Robbie, a Whac-A-Mole game show and a Thomas & Friends series.
The company’s latest multi year forecast comes after strong fourth-quarter results which were released earlier this month. Mattel’s impressive full-year 2020 performance has also been a topic of conversation on Wall Street. Former hedge fund manager Jim Cramer stated before Mattel’s latest announcement that he thinks that the company’s stock is inexpensive.
Shawn Collins, a Citi analyst also upgraded Mattel shares before the company’s presentation, boosting his price from $20 to $22.5, stating that “Retail toy demand remains robust into 2021, and we expect it will be further aided by the Biden administration stimulus and a rebounding US economy.”
Other business news can be found here.
next