Toy maker Mattel to cut 2,200 jobs

[charliep]

========================================================================================================================

Thought this may be of some interest to the Matchbox collectors. Not sure how it will make any difference to Mattel's global operations.

========================================================================================================================
Mattel shares sink 8% as company slashes 2,200 jobs
Toy maker Mattel to cut 2,200 jobs as part of the cost savings plan it detailed in October.
In April, the company said it was shuttering its New York office.
Mattel has been deeply impacted by the bankruptcy and liquidation of Toys R Us.
Sarah Whitten | @sarahwhit10
Published 15 Hours Ago Updated 14 Hours AgoCNBC.com
A customer browses the Mattel Barbie dolls section of a now closed Toys 'R' Us store.
Chris Ratcliffe | Bloomberg | Getty Images
A customer browses the Mattel Barbie dolls section of a now closed Toys 'R' Us store.
Shares of Mattel plummeted more than 8 percent after the company disclosed that it would be cutting 2,200 jobs on Wednesday.

The company said this reduction represents 22 percent of its global non-manufacturing workforce.

The toy company had announced a cost savings program in October, with the goal of eliminating $650 million in costs over two years —
one-third of which it expects to achieve this year. As part of that initiative, Mattel had already planned to sell several manufacturing factories in Mexico.

These job cuts come just months after the company said it was shuttering its New York office, affecting about 100 employees.

On Wednesday, Mattel's quarterly sales missed Wall Street estimates, weighed down by the liquidation of key customer Toys 'R' Us and the absence of a big movie tie-in in the quarter.

“We ... had a challenging second quarter driven primarily by the Toys “R” Us liquidation,” Mattel’s new CEO Ynon Kreiz said.

Net loss in the reported quarter widened to $240.9 million, or 70 cents per share, from $56.1 million, or 16 cents per share, a year earlier.

Excluding items, Mattel lost 56 cents per share, a much steeper loss than the 30 cents per share analysts had expected, according to Thomson Reuters.

Mattel's net sales fell 13.7 percent to $840.7 million in the second quarter ended June 30, short of the $851.8 million analysts had expected.

Revenue from the company's partner brands, which includes sales from toys based on movie franchisees, fell 32 percent from the year-ago quarter.
The company saw weaker sales of its Cars toys, which was partially offset by sales of toys tied to Jurassic World.

The company, like the rest of the U.S. toy industry, has been hit hard by the liquidation of retailer Toys ‘R’ Us and said the closure of its biggest customer
dented its gross sales by 10 percent in the second quarter.

— CNBC's Lauren Hirsch and Reuters contributed to this report.

[GHOSTHUNTER]

If Mattel sell the Matchbox brand, it is unlikely to come back to the UK, but could go to Majorette who are quite capable of producing and marketing the type of product line seen under the various Matchbox ranges.

Ghosthunter.

[matchboxmarcel]

I hope they fire all people responsible for distribution as distribution is worse then ever.
Those people probably only drinking coffee for the full day.

marcel

[misterpop]

If Majorette get the Matchbox brand it could spark a brand new line of realistic cars and trucks...Brilliant for us who have been waiting for the likes of a scrap Montego on the back of a trailer pulled by a Renualt 25.......But think of the kids..What the hell would they make of them..I have 4 boys in my brood and non of them has any interest in collecting diecast,they dont even race them to distruction......Mind you it means I have a box in the shed full of HWs from all years of the 2000s to sell on when the USA stocks run out but I can forsee that taking a long time as there seem to be tons of HWs still sitting in Tesco,Asda,Sainsburys,even Aldi has a load of gift sets stock piled..

.Lets hope things go alright for the ex Hot Wheels workers and some new,interesting and collectable items can emerge and relight our fires...

[GHOSTHUNTER]

A good thing about the 'Brand' name be it Hot Wheels, Matchbox or whatever, they are strong brands which have been well established and are known throughout the civilised world so it will be just a change of ownership which we have seen before and happens all the time in the hobby market and I am OK with whoever buys Matchbox (if Mattel do sell it!), as it ensures the name lives on...long live Matchbox.

Ghosthunter.

[ClOwY]

PM sent

[GHOSTHUNTER]

PM sent

Thanks Gary, reply sent.

Ghosty.

[David Tilley]

Well it's always sad when people are losing jobs etc, but for the short term I see literally no change in the Matchbox scenario.

As it was stated, the initial jobs are down to closure of a site in New York, which has nothing to do with Matchbox. It also will be closing factories in Mexico. Again nothing to do with Matchbox. Therefore plans they have going forward across their whole portfolio will be unaffected.

However, long term if sales continue to decline it could mean that Mattel will start thinking about whether they can try and offset anything by either amalgamating with another company (they swallowed up Tyco in the 1990s which itself was a very large company), or they could start to break up the company slightly by selling off some of the smaller brands it uses. One of these would most likely be Matchbox. If that was the case one company I would not want to see it go to would be Simba Dickie. As they already have Solido, Schuco and Majorette in their portfolio, this would put Matchbox in an awkward position in that it almost identical in where they are placing the Majorette brand. So that would mean they would have to totally change their whole idea of what Matchbox could be (which could be disastrous). But with 2 other diecast car brands in their portfolio it means that finding a position for Matchbox would be really tough. I doubt they would want it except to maybe bury it and squash that competition in one easy move. If they were to consider selling the brand in the future, I would prefer it go to something like Hasbro. A massive toy company who so far have very little inroads in the diecast segment. They own Tonka but are loaning it to Maisto as a way to introduce younger children into toy vehicles, but that is mainly construction & trucks only. I could see them taking the brand, & with no sister brand (Mattel having Hot Wheels, which seems to get priority a lot) in the company they could put their full force behind it to try and create a new large diecast brand.