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Mattel, Inc. (NASDAQ: MAT) today reported 2013 second quarter financial results. For the quarter, the Company reported net income of $73.3 million, or $0.21 per share, compared to last year’s second quarter net income of $96.2 million, or $0.28 per share.
“Overall, our underlying performance in the first half of the year is consistent with our long-term financial goals for sales and operating profit growth,” said Bryan G. Stockton, Mattel Chairman and Chief Executive Officer. “While we delivered another quarter of sales growth and strong gross margins, lower profits in the second quarter reflect an asset impairment charge and strategic investments made to support consistent future growth. As we look to the second half of the year and the all-important holiday season, we are excited by the innovative product, entertainment and retail programs planned and we remain focused on leveraging our industry leading portfolio of strong brands, countries and customers.”
For the quarter, net sales were $1.17 billion, up 1% compared to last year, with no impact from changes in currency exchange rates. On a regional basis, second quarter gross sales decreased 2% in the North American Region, which consists of the U.S., Canada and American Girl, with no impact from changes in currency exchange rates. In the International Region, gross sales increased 4%, with no impact from changes in currency exchange rates. Operating income for the quarter was $94.8 million, compared to prior year’s operating income for the quarter of $131.4 million.
The Company’s debt-to-total-capital ratio was 36.7%. For the first half of the year, the Company’s cash and equivalents declined by approximately $513 million, compared with a decline of approximately $997 million in last year’s first half.
For the first half of the year, cash flows used for operating activities were approximately $286 million, an increase of $224 million compared to approximately $62 million of cash flows used for operating activities in the first half of 2012. The increase is primarily due to higher working capital usage. Cash flows used for investing activities were approximately $132 million, a decrease of $683 million driven primarily by the prior year acquisition of HIT Entertainment. Cash flows used for financing and other activities were approximately $95 million, a decrease of $25 million, compared to approximately $120 million in 2012, primarily due to net proceeds received from the issuance of long-term debt, partially offset by repayments of long-term debt and higher share repurchases.