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Crisis management: Mattel (2008)

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documents in English
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case study
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5 pages
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  1. Overview of Mattel
    1. Background
    2. Financial Data
  2. The crisis of 2007
    1. Historical Facts
    2. Consequences
  3. Our project
    1. Exploring the crisis
    2. General interest
  4. Conclusion

Hitherto regarded as the undisputed leader of the global toy market, Mattel experienced problems that tarnished that image in the second half of 2007. In fact, the various toy recalls which were widely reported by media, made an impact both on its relationship with consumers as well as its relations with its various partners. While the results show a growth, the share price has fluctuated considerably since last summer. Therefore it seemed interesting to study this "paradox" and examine the foundations and consequences of this crisis.

Mattel was founded in 1945 and its IPO was launched 18 years later, on August 12, 1963. Mattel Inc. is now listed on the New York Stock Exchange, and has been on the NYSE Euronext since its 2007 merger with the different European markets (Paris, Benelux, Portugal and England). This is the largest group of global exchanges. Several indices comprise the NYSE. It generally includes the Dow Jones Industrial Average (including 28 of 30 companies are traded on the NYSE) and the Standard & Poor's 500, which includes 500 large companies with Mattel Inc.

Last year, on 9 April 2007, the share price was $ 29.71, its highest in 10 years. At the close of March 28, 2008 (almost a year later), the share price was $ 20.28 and its market capitalization was at 7 328.36 MUSD. The stock dropped by over 40% in a short time, because of manufacturing problems and poor financial reporting.

However, despite the small storm that just went through the company, Mattel recorded a net profit of $ 600 million for the fiscal year 2007 (up 1% from 2006). Its turnover was 5.97 billion, up 6%. This comes from the gross sales, which grew by 18% internationally, but dropped by 3% in the United States.

Recently, Mattel Inc. issued $ 350 million senior notes with a maturity period of five years. This fundraiser was aimed at serving the general activity of the company.

Tags: Mattel, New York Stock Exchange, European markets

[...] UNICEF Financial Data Mattel was founded in 1945 and its IPO was launched years later, on August Mattel Inc. is now listed on the New York Stock Exchange, and has been on the NYSE Euronext since its 2007 merger with the different European markets (Paris, Benelux, Portugal and England). This is the largest group of global exchanges. Several indices comprise the NYSE. It generally includes the Dow Jones Industrial Average (including 28 of 30 companies are traded on the NYSE) and the Standard & Poor's 500, which includes 500 large companies with Mattel Inc. [...]


[...] Thus, we will consider the actions taken by Mattel: o during the crisis (communication) o after the crisis (creation of a "corporate responsibility" group What role did communication by Mattel play in the management of the crisis? 3.2 General interest The study of Mattel and the crises it has faced, leads us to consider several issues addressed, and presents various educational aspects. Indeed, we shall have to study and analyze the financial disclosure that Mattel has put in place, in general, as well as at the time of crisis. [...]

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