Question

What are Mattel's financial strengths? Weaknesses?

Answer 1

Mattel is a leading company that is primarily in the business of toy manufacturing and other toy products. It's financial strengths include :

Financial Strengths:

• The company has a sizeable cash reserve and a strong cash flow from its existing revenue streams.
• The board of management at Mattel has created a position for the company in an effective manner & in the context of the expense standpoint
• The company is committed to the multiyear optimal rightsizing of the existing policies regarding its cost structure
• The success of the Structural Simplification program which is aimed at reducing the cost's and the cost savings have exceeded more than 600 Million USD.

Financial Weaknesses :

• Mattel's P.R(Profitability-Ratio) & the net contribution percentage have been lesser than the prevailing industry average.
• Loss in the market share in some segments/categories has led to the closure of some of the revenue streams.
• The collapse of the company "Toys R Us" has created a loss in revenue as they were a prominent retail partner for Mattel,
• Liquidation of Toys R Us and other currency fluctuations have led to a reduction in the gross-sales.