Business

Mattel removes CEO Bryan Stockton as Barbie sales plunge

Mattel Inc, the maker of Barbie dolls and Fisher-Price preschool toys, removed chairman and chief executive Bryan Stockton and warned of a fifth straight fall in quarterly sales.

Disappointing holiday season sees fall in revenue as Frozen toys dominate

Mattel reported disappointing holiday sales as Barbie lost out to Frozen. CEO Bryan Stockton has stepped down. (Paul Sakuma/Associated Press)

Mattel Inc, the maker of Barbie dolls and Fisher-Price preschool toys, removed chairman and chief executive Bryan Stockton and warned of a fifth straight fall in quarterly sales.

Mattel's shares fell as much as 11 per cent to a three-year low, and was down more than four per cent late Monday.

The company named former PepsiCo Inc executive Christopher Sinclair as chairman and interim CEO.

Mattel has been hit hard in recent years as its iconic Barbie doll has fallen out of favour with young girls, who are reaching for electronic toys such as tablets and dolls based on Walt Disney Co's hit animated movie Frozen.

The toy maker also disclosed that its net income tumbled 59 per cent to $149.9 million US from $369.2 million in the three months that ended Dec. 31. On a per-share basis, Mattel earned 44 cents per share in the most recent quarter, or 52 cents per share not counting hits from integration costs and taxes.

Revenue fell six per cent to $1.99 billion. Part of the hit to worldwide sales was caused by the rising U.S. dollar, which is making its toys more expensive in most of the world.

The company estimated its gross margin fell by 4.1 percentage points to 50.4 percent of net sales, mainly due to the acquisition of Canadian toymaker Mega Brands last year.

Stockton had been Mattel's CEO since January 2012 and he was named chairman in 2013. Sinclair is currently a member of the company's board.

"We were not anticipating this move, but believe the change was made following two consecutive years in which the company's holiday performance fell short of expectations," Stifel, Nicolaus & Co analysts wrote in a note on Monday.

Barbie sales have been falling for nearly three years and Mattel's other dolls such as Monster High and American Girl have failed to make up for her fading charm.

In 2009, Barbie held more than a quarter of the market for dolls and accessories in the United States, but that fell to 19.6 percent in 2013.

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