By Dhanya Skariachan
Oct 16 (Reuters) - Mattel Inc topped Wall Street’s profit estimates for the third quarter, benefiting from strong demand for its chubby-faced American Girl dolls and its Monster High line depicting the teen descendants of famous monsters.
The toy company, the world’s largest, also said on Wednesday that it would pay a cash dividend of 36 cents a share in the current quarter, bringing the total for the year up 16 percent from the 2012 payout. Its shares rose 4 percent to $43.20.
The news comes as manufacturers and retailers gear up for the holiday season, the biggest selling period of the year. Rival Hasbro Inc is due to report its quarterly results next week.
“The upside performance gives us increased confidence going into the holiday season,” said MKM Partners analyst Eric Handler, who called the company’s holiday lineup “solid.”
Mattel’s toys for the big season include additions to the Thomas the Train, Sofia the First, Max Steel and Planes brands, along with a Barbie campaign centered on a new Dreamhouse.
The company said stores were managing their inventories tightly heading into the holiday season.
“Retailers had been cautious, and they remain cautious,” Mattel Chief Executive Officer Bryan Stockton said on a conference call, adding that they “continue to order based on what is selling.”
The company sells its wares through retailers such as Wal-Mart Stores Inc, Toys R Us Inc, Target Corp and Amazon.com Inc, as well as through its own website.
Mattel said third-quarter net income rose to $422.8 million, or $1.21 a share, from $365.9 million, or $1.04 a share, a year earlier.
Analysts on average expected a profit of $1.12 a share, according to Thomson Reuters I/B/E/S.
Sales rose 6 percent to $2.21 billion, beating the analysts’ average estimate of $2.17 billion.
Barbie sales increased 3 percent, after posting declines in the previous four quarters. Total Barbie shipments in July, August and September rose 11.1 percent from the year-earlier period, according to figures that supply-chain data company Panjiva pulled for Reuters.
But the iconic doll, which was introduced more than 50 years ago, had been overshadowed by the Monster High line.
Sales were up 20 percent for American Girl and up 28 percent for Mattel’s “other girls’ brands,” which include the Monster High dolls.
Sales were flat for the Fisher-Price brand and fell 9 percent at the unit that includes Hot Wheels toy cars.