Mattel CEO resigns as profits plunge

The chairman and CEO of Hit Entertainment’s parent company, Mattel, has resigned after weak sales hit the US toy company’s bottom line.

Bryan Stockton has stepped down, with independent board lead Christopher Sinclair installed as interim chair and chief executive.

Mattel acquired UK-based Thomas the Tank Engine (aka Thomas & Friends) rights owner Hit for US$680 million in 2011.

Stockton’s resignation came after full-year net income for 2014 came in at US$498.9 million, compared with US$903.9 million a year earlier, and worldwide sales revenues dropped 7% year-on-year to US$6.02 billion.

Other key signifiers were down, with Mattel in part attributing an acquisition of rival toy firm MEGA Brands for US$460 million and a fall in sales of the Barbie doll brand to the decreases.

“Mattel is an exceptional company with a great future but the Board believes that it is the right time for new leadership to maximise its potential,” said Sinclair. “We are committed to delivering improved growth and financial performance and remain confident in our ability to leverage our unmatched portfolio of brands, global scale and strong balance sheet as we execute on our strategic plan.

“On behalf of the board and everyone at Mattel, I sincerely thank Bryan for his many valuable contributions over the past 15 years in expanding our business and portfolio of brands and building our executive team.”

The company has largely avoided the television and film business. Its acquisition of Hit was largely guided by potential toy sales of Thomas, and there have been sporadic rumours it plans to sell other brands such as Barney and Bob the Builder.