Good day, ladies and gentlemen, and welcome to Mattel's First Quarter 2014 Earnings Conference Call. At this time all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. (Operator Instructions) As a reminder, this conference call is being recorded. I would now like to turn the conference over to Drew Vollero, Senior Vice President of Investor Relations and Corporate Strategy. Sir, you may begin.

Thank you, Latoya. As you know, this morning, we reported Mattel's 2014 first quarter financial results. We've provided you with a slide presentation to help guide our discussion today. The slide presentation and the information required by Regulation G regarding non-GAAP financial measures is available on the Investors and Media Section of our corporate Web site, corporate.mattel.com. In a few minutes, Bryan Stockton, Mattel's Chairman and CEO and Kevin Farr, Mattel's CFO, will provide comments and the results, and then the call will be open for your questions. Certain statements made during the call may include forward-looking statements relating to the future performance of our overall business, brands and product lines. These statements are based on currently available information, and they're subject to a number of significant risks and uncertainties, which could cause our actual results to differ materially from those projected in the forward-looking statements. We described some of these uncertainties in the Risk Factor section of our 2013 Annual Report on Form 10-K and our 2013 quarterly reports on Forms 10-Q and in other filings we make with the SEC from time to time, as well as in other public statements. Mattel does not update forward-looking statements and expressly disclaims any obligation to do so. Now, I'd like to turn the call over to Bryan.

Thank you Drew and good day everyone. When we spoke with you in February, we said the key to success in 2014 will be to improve POS, and to do that we needed to introduce more product and brand innovation, improve the execution of our promotion and marketing spending and to leverage some of the tailwinds we had coming out of 2013. We also said we needed to work through inventory both owned and at retail in the first half of the year as well as manage the cost structure to align with more realistic revenue assumptions. Overall, we made progress in the quarter on a number of these areas. However, it is the preseason the time we use to make adjustments for the fall, and we recognize we have a lot of work to do as we continue to prepare for the all important holiday season. Let me briefly outline the results for the quarter. As expected, revenues were down slightly as we worked our way through pockets of retail inventory, managed our owned inventory and shifted trade spend and advertising to the back half of the year. Gross margins were lower than prior year and down a little more than expected reflecting the progress made on managing inventories. That said, we continue to manage gross margins for the full year and remain committed to our near-term outlook of low to mid 50% gross margins. Advertising expenses were low in the quarter both in dollars and by percentage as we shift spending to later in the year. SG&A was up slightly consistent with the outlook we shared with you in February including incremental severance expenses of $16 million tied to our ongoing OE 3.0 initiatives. And we remained committed to sound capital deployment in the quarter. We raised our…

Thank you Bryan and good morning everyone. As Bryan said, we made good progress in the quarter on a number of areas as we work to deliver top third to top quartile total shareholder returns in the near term. First, we made good progress. We’ve gone to addressing higher retail Mattel-owned inventories. We reduced the year-over-year impact of our owned inventory by about 50% or $50 million and after normalizing for Easter we believe retail inventories are in much better shape from where we were at the beginning of the year. Second, we aligned our infrastructure with realistic revenue assumptions, which puts us in a better position for 2014 and beyond. We lean into our OE 3.0 cost savings program and made some top strategic decisions in the quarter, including a reduction in force. The savings related to this action will help us to achieve the programs $175 million of gross sustainable savings targeted by year end. We also continue to see savings in gross margin related to our OE 3.0 programs such as our packaging initiative. Third, we make progress in global POS by leveraging our North American organization and international subsidiaries by working closely with our retail partners. These gains represent a good step forward from our 2013 holiday season, but there is more work to be done. And finally, as we said given the evolving consumer path to purchase we are working our ways to get a higher return on our advertising spending by bringing better signs and analytics through our advertising and trade spending programs, so spending can work harder and go further. In this regard we make considerable progress on developing a sophisticated marketing mix model which allows us to measure the sales contribution of each of our advertising and trade spending program levels. As…

Thank you. (Operator Instructions) Your first question comes from Jaime Katz of Morningstar. Your line is open. Jaime M. Katz – Morningstar Research: Good morning, everybody. Thanks for taking my questions. Can we start off by talking about the other growth category and the slowing cadence? Obviously you’re lapping some difficult numbers, but was there anything else in that category that we should know about?

Hi, Jaime. Good morning. It’s Bryan. We’re pleased with where we are. I think at this point, as I mentioned, overall with our Girls portfolio POS was positive for the quarter. Shipping was down a little bit and that was due to us trying to work through some pockets of inventory at retail. If you think about what’s in the other Girls, Ever After High, I think I mentioned in my comments, if you look at where that is today with the retail support and consumer takeaway that looks it’s going to be at least the solid single. Monster High, we’re very keen. I know it’s a huge, huge business for us now. It’s a brand that we think is ingrained with Girls. It’s still the number two doll brand. It’s the number three property in the toys according to NPD for the U.S. We know consumers are still very engaged with the brand. If you look at the minutes girls are spending on a website it’s unchanged. What’s impressive is if you look at the total video views of Monster High sequentially from quarter four to quarter one it’s up 14%. So we know Girls store engage with this brand. We’re going to continue to support this brand with a lot of things. As I mentioned, we’re going to support it with 16 new characters and new segments like the pets, new accessories. I think you may have seen the Monster Maker at Toy Fair. That we think is a huge breakthrough, innovative product and we’re going to continue with web results. So we still like Monster High. Then you start looking at Disney and with Disney we’re very pleased. Frozen is doing quite well as is Sofia, and with the growth in the box office in that movie we’ve been ramping up our ability to support the demand. It’s being created by that. So we like that a lot too. So if you look what’s in there, Disney likes good. Monster High, we had a bit of a bump in the first quarter, but we continue to believe that that’s the important part of our portfolio and we’re going to continue to invest in it ever after High is off to a pretty good start and we’ll see how it goes. Jaime M. Katz – Morningstar Research: Okay. And then, there was a comment in your slide saying that there is this continued shift to e-commerce from brick and mortar. And I think at Toy Fair it was indicated that it’s still something like 80% to 85% of people shop for toys in the brick and mortar channel. So can you talk a little bit about how you guys are adapting to that shift and where you think you can sort of make some strides there?

Sure. The statistics that, I think we shared, were that purchases of toys were about 85% still in brick and mortar. When we use the word shopping we’re careful how we use that, because shopping is really a variety of exercises. It’s exploring, it’s evaluating, it’s reading all the various reviews of products out there. So what we said is the consumer path to purchase is becoming very complex, a lot of touch points. But ultimately when the purchase is made, last year about 15% was made online and about 85% was done in store. So what we’re doing is a couple of things. Number one, we’re going to continue to invest in the e-commerce channel. We’ve invested in this channel for a number of years. I’ve always bored everyone with the same example of grocery drug that we invested in years ago. But we continue to over index in terms of share in that channel and then the second thing we are doing as we’ve talked about this marketing mix modeling, where we are using pretty sophisticated techniques and the analytics to understand the impact of how we spend our money. And we are able to get a better understanding of how things are impacted online for example, things like Paid Search. So we are really anxious to start to apply those lessons learned to the e-commerce channel as well as to brick and mortar and throughout the entire path to purchase.

Yes, I think, I just like to add to the path of purchase I think also starts online we are seeing more people look online to really look at what they want to purchase. And as you said, 80% to 85% of those purchases are still done in stores, so we are really working on first, maximizing our business online and getting all the logistics together to be a good e-retailer. So we are getting product reviews in place, we are getting digital assets where they need to be and obviously, our investment in launch pattern our ability really to connect with consumers with regard to our brands, because it’s a good opportunity to highlight our brands online. And then we are also putting dedicated resources on being a good e-tailer as well as having our brands be prominent online so that as we look at our marketing mix model and do more paid searches that they can really review our products in their expiration to the path of purchase and then covert in online or in brick and mortars. Jaime M. Katz – Morningstar Research: Okay, and then lastly, the gross margin assumptions that guys have for the year the low 50% range, does that include sort of where you think you can go with MEGA, or should we expect any changes once that acquisition is closed?

Yes, I think with regard to the acquisition, if we look at it without MEGA, again I think we are focused over the near-term we’re delivering margins in the low to mid 50s range. When you add MEGA Brands, it has a gross margin which has a near-term negative impact about 100 basis points, but we see an opportunity to improve this materially overtime. So I see in the near-term there is a negative impact longer-term I think there is an opportunity to grow gross margins for MEGA because when you look at the category in total, the gross margin profile of the category is very comparable to what it is in to our doll portfolio. And we look at opportunities as we put our brands on their platform to increase gross margins for MEGA Brands and that should also help our gross margins over the long-term. Jaime M. Katz – Morningstar Research: Thank you.

Thank you. And the next question is from Mike Swartz of SunTrust. Your line is open. Michael A. Swartz – SunTrust Robinson Humphrey: Hey, good morning guys. Could you maybe talk about the emerging markets maybe in a little more color and kind of the trends you are seeing there understanding that there were some pockets of inventory, you should point it out, but maybe just boiling it down to what inventories look like there overall. And maybe just POS as you are seeing coming out of emerging markets right now?

Good morning Mike, it’s Bryan. So I would say if you think about emerging markets and I’ll sort of lump a number of them together if you think about Latin America, Eastern-Europe, China, Russia for example. They are all quite strong we think long-term the economy should be growing and household formation is particularly in the middle-class, we think argues well for continued growth in the toy industry. Retail continue to modernize in each of those countries which also argues well for the toy category and for Mattel. So from a long-term standpoint we like these markets, a lot of them we are going to continue to invest in these markets a lot. If you think about performance Asia led particularly by China is quite strong. It was offset by Australia which is I think we probably mentioned before is going through some adjustments and how they dealt with their catalogue in Christmas businesses and that’s a say country in retailer comment not a Mattel’s specific comment. The business in Russia continues to grow very substantially. We are very pleased with that business as we are with the rest of the Eastern Europe. Latin America, we’ve been there a long time, we think Latin America has a lot of potential left in itself for household formation and toy industry growth. We’ve been there a long time and it’s a very profitable business, toys it’s a large business. But as you know the economy slowed down in Latin America that in turn had in impact on the toy industry. Our assessment of the Latin American toy industry right now is in the first quarter sort of flattish. So when you plan for growth and then the category doesn’t grow, we wind up with some pockets of inventory in Latin America and you see us working through that. The good news is as the POS is up substantially in Latin America as we work through that. There is more work to be done in inventories in Latin America, but overall I would tell you long-term we are very keen on investing in all of these emerging and developing markets. Michael A. Swartz – SunTrust Robinson Humphrey: Okay, that was helpful. And then just in terms of OE 3.0 and maybe thinking about how the cadence of those savings that are planned kind of roll throughout the year, I mean can you just help us with a little more color there?

Yes, I think there will be a little bit incremental over the next few quarters, but the majority of those savings are going to come in the second half of the year, and principally that the biggest driver of the OE 3.0 savings this year is really our initiatives that you are going to see in gross margin and particularly package and savings. So we saw that come online and increase in the first quarter, incrementally that should continue to increase, but most of it will be in the back half of the year. Michael A. Swartz – SunTrust Robinson Humphrey: Okay, thanks a lot.

Thank you. And the next question is from Eric Handler of MKM Partners. Your line is open. Eric O. Handler – MKM Partners LLC: Thanks a lot. Just two quick things, first, when you look at the gross savings versus net savings for the OE 3.0 program for this year, where do you think the net savings finish out relative to the gross savings. And then if I’m hearing you correctly, it seems like inventories in the U.S. now are pretty clean and the issues are pretty much just all international.

Okay, so I think with regard to OE 3.0 savings, we expect to deliver the gross savings of $115 million this year, and as we said in February, we intend to lean into OE 3.0 cost savings programs in 2014. As we look at the first quarter our reduction in workforce was a strategic to streamline our workforce as part of our OE 3.0 initiatives to drive efficiencies across the organization in order to reallocate funds, investing growth and to improve our profitability. And we are going to continue look at additional opportunities improve the effectiveness and efficiency of Mattel across brands, geographies and functions including our global supply chain. So I think there will be additional investments as we go through the year to drive OE 3.0 savings, but at this point we are not going to give detailed assessment of that, but we do expect overall OE 3.0 programs to have net savings for the year after investments.

With respect to inventories we have done a pretty good job with regard to managing retail inventories that were slightly up at year-end, so it’s not been the issue. Really when we look at pockets of inventory really it varies by brand, but overall we are in pretty good shape with regard to retail inventories but there isn’t we said more work to do with retail inventories in select markets and particularly in Latin America. Eric O. Handler – MKM Partners LLC: Okay, thank you.

Thank you. And the next question is from Linda Bolton Weiser of B. Riley. Your line is open. Linda Bolton Weiser – B. Riley & Co. LLC:

Hi, Linda. It’s Bryan. I’m not going to get into brand detail on POS on Monster High. What I would tell you is that our consumer products business is we look at that did grow both in the U.S. and outside of the U.S. and the consumer products businesses things like apparel and hair accessories and supporting goods, so I did mention that. Linda Bolton Weiser – B. Riley & Co. LLC: Okay and then just another question on the cost savings. I guess I’m a little confused about the headcount reductions and severance charges in the first quarter. Were those things that were planned to be in addition to OE 3.0 programs or are they just they were all just kind of planned as part of the OE 3.0 program, so should we think about…

No, they were part of the OE 3.0 initiatives. Linda Bolton-Weiser – B. Riley & Co. LLC: Okay, great. That’s all I had, thanks.

Thank you. And the next question is from Tim Conder of Wells Fargo. Your line is open. Timothy A. Conder – Wells Fargo Securities LLC: Thank you. Good morning gentlemen. A couple of things here, I guess on the inventories again, you’ve talked quite a bit about you’re fairly happy at retail, more work to go especially in Latin America, at the retail level. But at the company level, I’m a little confused because you’re up $50 million year-over-year in the quarter, and up $80 million since year-end. Can you give us a little bit more color on that, I know BOOMco. is coming and the shift in Easter on that. Just maybe a little bit more how much those components are driving that versus anything else?

Yes, I think going back to the inventory, I think where we ended the year in 2013, we are up year-over-year by about $104 million. And as we close the first quarter, we were up by about $50 million. So we’ve made significant progress on Mattel owned inventories in the quarter in reducing them. We’ve got more to go, but we feel like we’ve made good progress in the first quarter. And as I said the initiative to sell Mattel owned inventories result about half of the declining gross margin versus last year or about 160 basis points or so. The other key factors in margin where royalties and a record comp in the prior year. And in the first quarter, we executed on the initiatives reduced the Mattel owned inventories and we said it’s down by $50 million. And the aggressive disposition of our owned inventories was a local management decision made market by market to convert inventory into cash and be better positioned as we move throughout the year. That cost of that disposition is around $50 million in the quarter versus the prior year, which given the size of Mattel, is a relatively small impact in our full year results, and did cause swing in the quarter. But as we look at the full year and we look at our cost assumptions that from the perspective of the good news in gross margins are cost assumptions aligned with our pricing actions and our OE 3.0 expectations. And as we look at the near-term, we are focused in are delivering under target margins of low to mid 50s range. Timothy A. Conder – Wells Fargo Securities LLC: Okay. Kevin and along that line from a good news standpoint, the weakening of the Chinese currency, here 2.5%, 3% since mid-February in particular. Will that potentially have any benefit by fourth quarter? I know you contract and you have costs set several quarters in advance, but when assuming nothing changes from here, could that potentially show some incremental benefit to gross margin?

The good news over the last couple of years is they have been low volatility input cost. I include forex as one of those input costs and assuming that mix holds up well and that we have low volatility in input costs, I think what we're saying right now is the good news, is that aligns with our pricing and OE 3.0 expectations to keep us on track to deliver in the near-term low to mid 50s gross margins. Timothy A. Conder – Wells Fargo Securities LLC: Okay. And then on the innovation side, Bryan, your commentary that you or Kevin made in the preamble regarding Fisher-Price Core, some of the products there and the price points, that would seem somewhat critical to accelerate in that penetration of the Fisher-Price Core on the international side. Can you expand on that? And then maybe a little bit more expansion on how you're taking and looking at the ability to gather and enhance consumer insights and to then tailor your R&D for innovation.

Sure, Tim. Let me first comment on Fisher-Price and innovation. We’re pleased, for example, with our BabyGear line, BabyGear POS is positive, and that's driven by the innovation that we shared with you at New York Toy Fair. We shared some of the Smart Stages technology, where you take a toy and then you basically are able to age grade it up as your child grows. We think that's pretty innovative and moms tell it is. So we’re hoping the response for that is as positive as it is to BabyGear. So we're excited about that. And as we said on Fisher-Price, we're sort of fine-tuning the marketing and really dialing at the energy behind innovation. As it relates to what we're doing in international and Fisher-Price, you're probably tired of me talking about the Soothe & Sleep Seahorse in China, but that’s an example of the kinds of things we’re trying to do in some of the countries with scale like in Brazil or Mexico. I mentioned the emerging consumer line. That’s basically really working. The consumers in those markets to understand but some of the key benefits are and some of the key features, trying to design the net and offer a toy that may not be as attractive in the U.S., but is very appealing to someone who has just joined the middle class in one of these emerging countries. So we're spending a lot of time doing that. And then finally, as it relates to insights, we’re investing heavily in that both in terms of people and in terms of technology. I’ve mentioned and Kevin has mentioned to the marketing mix modeling. We're very pleased with the early reads on that and have began to really try to translate some of those findings into how we want to change our spending in the second half. We’ve been sharing that with our retail partners and are beginning to reshape plans for the fall. So I think that's a good example, better execution and as we add more capabilities and more human resources into insights, we’ll be able to extend that into more regions of the world. So, I’m pleased with that progress but I think our team this morning is – we’re happy but not satisfied, there is more work to do. I’m happy but there is more work to do on the insights. Timothy A. Conder – Wells Fargo Securities LLC: Okay great. Thank you, gentlemen.

Thank you. And the next question is from Sean McGowan of Needham & Company your line is open. Sean P. McGowan – Needham & Co. LLC: Good morning guys, I have a couple of questions to, I’m talking about the toy sales of Monster High. Taking a little dip in the first quarter, but having now Ever After, which was there a year ago. Would the increments of Ever After have offset whatever decline is on the toy sales of Monster High?

Hi Sean, good morning I’m not going to give into the detail of what offsets what. We’ve tried to run our Girls business as a portfolio, and in that portfolio we have a number of brands as we look at each really kind of makeup that portfolio with Disney Princess sort of on the lower end of the age range in Monster High and Ever After on the upper-end. So as I said Monster High, all the signs are there that it’s a large brand, it’s a brand that’s becoming evergreen and there is lots of things that we are doing on in terms of investing in it. It’s a huge business force as you know. Now on Ever After high, I think the last time we got together, I said it was too early. I’ll tell you it’s still too early but the data that we’ve seen between our last call and this call would suggest that it’s at least a solid single, again looking at retail support and consumer takeaway and brand engagement.

Yes it’s still early yet, but I think we’re excited about as we do in the global launch of Ever After High and that we think as Bryan said it has good potential on a global basis. Right now we think it’s at least a single and hopefully with the engagement, we’re seeing that it will be better than at least a single. Sean P. McGowan – Needham & Co. LLC:

Yes, they are consistent with what I said in New York that retail inventories, we’ve accrued most of that in the year-end accounts. So when you look at retail inventories impact programs around that in the first quarter results, it had an insignificant impact in gross margins. It was shown about 20 basis points. Sean P. McGowan – Needham & Co. LLC:

But we just think with all the things going on whether it’s online purchasing or baby stores, there is a lot of opportunities for us to grow Fisher-Price. But Toys “R” Us is the good retail partner for us and we’ll work with them no matter what their strategy.

Yes, I think it’s about innovation and then I think also as Bryan said particularly with things like Fisher-Price where there the mom purchases and there are also big bulky products, we think online is a great opportunity for us on a global basis including places like China. So retail will continue to evolve, but I think having innovation in our brands having the right marketing message really focusing on solving consumer issues and providing benefits to them are going to drive that brand in the future. Sean P. McGowan – Needham & Co. LLC: Okay, and then my last question is, I knew I was asking a couple of questions which you probably wouldn’t comment on but maybe this will have more luck with, retail toy manufactures faced a couple of challenges and shipping in the first quarter, one toys maybe in your case retailer overhang of some of your owned product, second was overall category sluggishness in the fourth quarter. But in addition you have retailer across the board but every category most retailers having a pretty tough first quarter for a variety of reasons economic, weather whatever, to what extend do you think that larger non-toy, non-Mattel sort of general retail weakness affected you. And do you think that’s cleared out now, I mean not just whether wise, but do you think retailers are feeling generally better about their overall open device.

Yes, Sean, I guess the way I will think about that question is, as you know every year at this time, it is always difficult to determine exactly where we are and I’ll use the [VS] (ph) in the toy category in this case. Easter timing is quite late this year and that’s a very important toy gift holiday here in the United States, and a couple of countries outside the U.S. So it’s really hard I think to assess where are we in terms of consumer purchasing particularly in toys until we sort of get to mid-May. One thing, I think we are encouraged by as retailers did do a little bit better March based on some of the reports on the last week or so. If I look at our POS across Mattel and on brands like Barbie for example, we did a much better in March than we did earlier in the quarter. And so there is probably some upside to retail in March we’ll wait and see and we’ll have to wait and see what the NPD category tells us for March and also for Easter as well. So I’d say, we are cautiously optimistic and that’s driven by the recent trends in our POS. Sean P. McGowan – Needham & Co. LLC: As George Harrison said, It's Been a Long Cold Lonely Winter, so let’s bring on the spring, thanks.

Thanks Sean.

Thank you. The next question is from Gerrick Johnson of BMO Capital Markets. Your line is open. Gerrick L. Johnson – BMO Capital Markets: Hey good morning guys. I just want to be clear about POS because earlier on you mentioned that you do some adjustments for that late Easter. I was hoping to get maybe gives us both a clean unadjusted number for POS in North America and International and perhaps an adjusted number, how much you think Easter did impact POS?

Gerrick, I’m not going to get into detail on POS the issue we have this year in looking at the analytics is Easter was a March 31, last year so the POS for that holiday again particularly here in the U.S. would have been in the prior week the POS for Easter is happening now in the middle of April for this year. And so it’s really hard to look at that. We’ve tried to take a look at the potential impact of that and we like where we are. Easter is worth we think probably a couple of points of category growth historically to the category in a Mattel. So again we have to sort of as we always say every year wait till the middle of May to sort to so through where we are. Having said that, if I look at sort of the momentum of Mattel’s brands in the fourth quarter in kind of the back half of the fourth quarter versus the back half of the first quarter we’ve made I think a solid improvement particularly on Barbie. Gerrick L. Johnson – BMO Capital Markets: Okay. And then on margins, can you quantify an impact on mix that’s one that you didn’t talked about in the run down on things return back in gross margin? Thanks.

Yes, Gary, we had a small negative impact in gross margin in the quarter. And it was not a significant driver of gross margins in the first quarter. Gerrick L. Johnson – BMO Capital Markets: Okay. Thank you.

You’re welcome.

Thank you. The next question is from Drew Crum of Stifel. Your line is open. Andrew E. Crum – Stifel, Nicolaus & Co., Inc.: Yes, thanks. Good morning everyone. So just a follow-up on Gerrick’s question on mix. What are you assuming in terms of gross margin or the impact on gross margin from Barbie and Monster High obviously both were down in the first quarter? I wondered, if you could comment on that. And then separately on fashion dolls. Bryan, can you remind us what the cadence on shipments were for Frozen, if I’d recall it was predominantly domestic in the fourth quarter and then International in the first quarter? So you just update us there? Thanks.

Hi Drew, I’ll start with the Disney and Frozen it was primarily a U.S. launch. There are a couple of other markets there in the fourth quarter, and it did expand in International. And it’s a huge success as I mentioned in our comments. We’re ramping up our production to meet the ever growing demand on this. So this is a great Disney property and we’re pleased to be a partner with them.

And again with regard to mix, you have to look at it from doll portfolio perspective. Dolls are a high margins, we’re vertically integrated. The category is a great margin category and when we have strength in the portfolio like we do it’s good to our margins. And as we look out assuming the doll portfolio remains relatively stable and our mix is relatively stable. And we see low volatility in costs, we expect to in the near term deliver low to mid 50s range. Andrew E. Crum – Stifel, Nicolaus & Co., Inc.: Got it, thanks guys.

Thank you. And the next question is from Greg Badishkanian of Citigroup. Your line is open. Gregory R. Badishkanian – Citigroup Global Markets Inc.: Yes, great. I was wondering, just I know you mentioned the layouts were part of the OE 3.0, but it sounds like the last were a little bit greater then maybe you’d initially expected last year when you’re planning for OE 3.0. Is that the case or is it in line?

Again Greg, I think it’s in line with what we expected as we looked at October of last year, we looked at again, it was strategic. We’ve basically looked at last year, we had a strategic opportunity to streamline our organization by scaling it. And as a result of that, we increased our OE 3.0 goal from $150 million to $175 million. And as we’ve looked at the first quarter, we made those strategic cuts to streamline organization. And what we’re trying to do is really look across the organization, across Mattel brands, markets, functions to really look at opportunities to reallocate resources, to take those resources and those funds either to invest in growth markets like Russia and China or drop some of it to the bottom line to improve our profitability. So it’s very consistent with our thoughts that we shared with you in October. Gregory R. Badishkanian – Citigroup Global Markets Inc.: Okay, all right. And then, just thinking about the second quarter, there’s a few impacts just maybe so we can kind of model for that. A little bit of excess inventory primarily in Latin America, a shift in advertising which may impact sales a little bit in the second quarter, but will benefit the second half. If you look at the different factors, how much is the second quarter going to be impacted?

Again, we don’t give guidance on 90-day increments. I think the one thing we’d say is with regard to the MEGA acquisition, we expect that to close in the second quarter and we’ll provide you more about the relevant financial metrics in our disclosures, which are consistent with acquisitions, but we’ll do that on the second quarter call. I think the one thing you should think about in the meantime is that MEGA will be in our results in the second quarter. It’s a public company. I’d point you to their public company filings to look at their revenues and their profitability in the second quarter. And then you have to consider that those won’t include acquisition accounting type things like riding up their inventory or opening balance sheet issues. But that’s about the only guidance I’m going to give you on the second quarter. We do, I think, in our call though mentioned that when we look at Mattel along the inventories and we look at our advertising, I think you have those two right that those will impact results in the second quarter, but that’s about the guidance we’re going to give you. Gregory R. Badishkanian – Citigroup Global Markets Inc.: Okay. And then just finally, in terms of the improvement over the last few weeks in POS that’s really good to hear. And how does that compare to the industry to the extent that you can maybe talk to other retailers or, I don’t know, if your POS would interact that and I don’t think MPD is out for that period, but how do you think the industry is doing during that time and why do you think your POS improved?

Well, I think what we’re doing is we’re spending a lot of time focusing on sharpening our execution. We talked about that a lot. We’ve got some interesting new products. I mentioned the Fisher-Price, BabyGear POS as positive. So we’re working a lot on just sharper execution. How it relates to the rest of the industry we’ll find out when MPD issues their report on March. Gregory R. Badishkanian – Citigroup Global Markets Inc.: Good.

I think from the industry perspective in the first quarter, I think it’s relatively flat based upon the information we have. I think the categories we’re in aren’t growing, other categories are. So overall it’s flattish and that’s about all we could tell you at this point.

And we have to get through Easter (indiscernible) for the U.S. are pretty significant gift giving occasion for toys. Gregory R. Badishkanian – Citigroup Global Markets Inc.: Great. Thank you.

Operator, we have time for one more question.

Okay. The final question is from Felicia Hendrix of Barclays. Your line is open. Felicia Hendrix – Barclays Capital, Inc.: Hi, good morning. Thank you. If we could just step back for a second and just – very big picture. Given the many initiatives that you have added on the call and gave us color on, do you think that you can grow earnings this year maybe exclusive of the noise that may come from the MEGA acquisition and also excluding share repurchase?

Again, I think you know this Felicia, but we don’t give guidance on an annual basis. I think that said, we’re focused on balancing all of our key P&L levers including sales growth, gross margin, advertising, SG&A and strategic growth initiatives. And in 2014, I think as I said at Toy Fair, we’re basing our business this year on realistic revenue assumptions and we’re focused on making the middle of P&L work harder, which includes delivering strong gross margins. I’ve also said we’re looking to lean into OE 3.0 programs to work that middle of the P&L harder and our goal is to deliver top third to top quartile TSR in the near-term. Felicia Hendrix – Barclays Capital, Inc.: Okay. And then just on Ever After High, Bryan you said many times on the call that it’s a solid single. I’m just wondering did you intended to be a single solid? I mean, is it turning out to be kind of what you planned it to be?

Well, Felicia, what we’ve always talked about is that Monster High is a grand grand slam home run. It’s huge. It’s over $1.5 billion at retail. It’s the number two doll brand, number three toy property and trying to replicate that would be quite a challenge. And as we talked about, creating new properties, whether it's Max Steel or Ever After High, for example, we’ve always said we’re perfectly happy with singles and doubles. The amount of investment that we make in these properties is not that high. If it's a single, we make money. We like that. So we’re perfectly happy with the series of singles and doubles. So I would say at the moment we're pleased with what we see. It's still early. We have to see how it plays out, but the connection with Girls is great. Initial conversion is to purchase, looks pretty good. We just have to see how that unfolds over the next quarter or two.

Yes, and we're excited about the global launch and also we’re excited that this is a franchise launch, which includes both toy products and consumer good products. Felicia Hendrix – Barclays Capital, Inc.: Okay. That's helpful. Thanks. And just finally on MEGA. I know you're going to integrate it in the second quarter, and maybe this question is a little bit premature. But I'm just wondering of everything that MEGA does what product lines are you going to be most focused on and where do you think you can get the most growth out of that acquisition?

Well, they've got a great product line across a number of segments and one of the reasons we bought this is because we felt that the license that they have, the technical capabilities they have, when you marry that with our global scale and the strength of our brands, we think we can do a great job of, number one, growing them globally because we have this massive North American and international distribution marketing organization that does so well. And by extending our brands like Barbie and Hot Wheels, they did a terrific job of sort of the initial parry end of the category with that and when this thing comes into the Mattel family and we’ll work even harder with them to do that. So there is a lot of opportunities with them, both in terms of global distribution gains and extending our brands.

Yes. And really with the platform, we're really, really, really excited about is the construction platform because that category is a growing category and that the margin profile of that category is fantastic. It's like fashion dolls. And we think our brands on that platform will drive results on a global basis. So we're very excited about that and they do have a nice arts & crafts business that we think in the future that we can leverage that platform because it is a growing category and it is something that we can do globally by putting our brands again on that arts & crafts platform and grow that on a global basis, but that's really secondary. Our initial focus really is on the construction. Felicia Hendrix – Barclays Capital, Inc.: Okay. And did the results in the fourth quarter surprised you or you were aware of that or is it totally irrelevant?

It was as expected, so it was not a surprise to us. Obviously as we do deep due diligence, we do get into their actual results as well as we look forward in our valuation model. It is right thing at the right time and the right price. And as we look at the right price, we are discounting cash flow, people here and we look at realistic revenue assumptions and we look at realistic profit assumptions with regard to cost synergies and we feel like we are going to create a lot of value for our shareholders by making this a stronger Number 2 player in the construction category. And we do see opportunities which we didn’t put much of the value on with regard to the arts and crafts. We do see opportunities again to put our brands on their platform and grow on a global basis through arts and crafts business. Felicia Hendrix – Barclays Capital, Inc.: Okay that’s helpful. Thank you.

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Ladies and gentlemen this concludes today’s conference, you may now disconnect. Good day.