Mattel Inc MAT
Q2 2013 Earnings Call Transcript

Transcript Call Date 07/17/2013

Operator: Good day ladies and gentlemen and welcome to the Mattel's Second Quarter 2013 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we'll conduct a question-and-answer session and instructions will follow at that time. As a reminder, this conference call is being recorded.

I would now turn the call over to you host, Drew Vollero, please go ahead.

Drew Vollero - SVP, IR: Thank you, Stephanie. As you know, this morning we reported Mattel's 2013 second quarter financial results. We have provided you with a slide presentation to help guide our discussion today. The slide presentation and the information required by Regulation G regarding non-GAAP financial measures is available on the Investors & Media section of our corporate website,

In a few minutes, Bryan Stockton, Mattel's Chairman and CEO; Tim Kilpin, Mattel's Executive Vice President of Global Brands; and Kevin Farr, Mattel's CFO will provide comments on the results and then the call will be opened for your questions.

Certain statements made during the call may include forward-looking statements relating to the future performance of our overall business, brands and product lines. These statements are based on currently available information and that is subject to a number of significant risks and uncertainties which could cause our actual results to differ materially from those projected in the forward-looking statements.

We described some of these uncertainties in the Risk Factors section of our 2012 Annual Report on Form 10-K, and our 2013 quarterly reports on Form 10-Q and in other filings we make with the SEC from time to time, as well as in other public statements. Mattel does not update forward-looking statements and expressly disclaims any obligation to do so.

Now, I'd like to turn the call over to Bryan.

Bryan Stockton - Chairman and CEO: Thank you, Drew, and good day everyone. Before we get into a discussion on our result for the quarter, I'd like to take a moment to talk about the industry and Mattel in general as we exit the pre-season and head into the second half of the year, where we do about two-thirds of our business.

Overall the global toy industry came out of the first half of 2013 in pretty good shape. Industry trends looked consistent with recent history with toy category sales flat to slightly down in the U.S. and Western Europe and growing in Latin America, Eastern Europe and Asia.

For Mattel specifically, important emerging growth markets such as China, Russia and India continued to prove to be fertile ground as all grew by double digits in the second quarter.

According to NPD, when you include American Girl, Mattel gained total toy share in both the U.S. and the EURO 5. At the category level, according to NPD, dolls represent one of the fastest growing parts of the toy industry, growing 11% in the U.S. and 4% in Europe through May.

As the number one player in the doll category, Mattel is well-positioned with the top four brands globally including Barbie, American Girl, Monster High and Disney Princess. As NPD did reflects, we continue to grow our overall doll share as we successfully innovate and diversify our portfolio.

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