Employee Benefit Plans (Tables)

12 Months Ended

Dec. 31, 2019

A summary of retirement plan expense, net is as follows:



	For the Year Ended
	December 31, 2019			December 31, 2018			December 31, 2017
	(In thousands)
Defined benefit pension plans	$	9,815		$	12,366		$	7,428
Defined contribution retirement plans	32,743			35,318			38,508
Postretirement benefit plans	(2,220		)	(2,148		)	963
Deferred compensation and excess benefit plans	10,994			(2,599		)	10,015
	$	51,332		$	42,937		$	56,914

Schedule of Defined Benefit Plan Amounts Recognized in Other Comprehensive Income (Loss)

A summary of the components of Mattel’s net periodic benefit cost (credit) and other changes in plan assets and benefit obligations recognized in other comprehensive (loss) income for the years ended December 31 is as follows:



	Defined Benefit Pension Plans									Postretirement Benefit Plans
	2019			2018			2017			2019			2018			2017
	(In thousands)
Net periodic benefit cost (credit):
Service cost	$	4,479		$	4,223		$	4,045		$	1		$	1		$	2
Interest cost	19,309			18,117			17,961			201			208			812
Expected return on plan assets	(21,714		)	(22,508		)	(23,072		)	—			—			—
Amortization of prior service cost (credit)	64			29			29			(2,038		)	(2,037		)	—
Recognized actuarial loss (gain)	7,585			8,518			8,362			(384		)	(320		)	149
Settlement loss	—			3,248			—			—			—			—
Curtailment loss	92			739			103			—			—			—
Net periodic benefit cost (credit)	$	9,815		$	12,366		$	7,428		$	(2,220	)	$	(2,148	)	$	963
Other changes in plan assets and benefit obligations recognized in other comprehensive (loss) income:
Net actuarial loss (gain)	$	28,740		$	(4,433	)	$	46		$	1,870		$	(276	)	$	(2,746	)
Prior service cost (credit)	26			114			—			—			—			(16,261		)
Amortization of prior service (cost) credit	(64		)	(29		)	(29		)	2,038			2,037			—
Total recognized in other comprehensive (loss) income (a)	$	28,702		$	(4,348	)	$	17		$	3,908		$	1,761		$	(19,007	)
Total recognized in net periodic benefit cost (credit) and other comprehensive (loss) income	$	38,517		$	8,018		$	7,445		$	1,688		$	(387	)	$	(18,044	)

(a)

Amounts exclude related tax expense of $5.5 million, $2.1 million, and $4.5 million, during 2019, 2018, and 2017, respectively, which are also included in other comprehensive (loss) income.

Schedule of Components of Net Periodic Benefit Cost



	Defined Benefit Pension Plans									Postretirement Benefit Plans
	2019			2018			2017			2019			2018			2017
	(In thousands)
Net periodic benefit cost (credit):
Service cost	$	4,479		$	4,223		$	4,045		$	1		$	1		$	2
Interest cost	19,309			18,117			17,961			201			208			812
Expected return on plan assets	(21,714		)	(22,508		)	(23,072		)	—			—			—
Amortization of prior service cost (credit)	64			29			29			(2,038		)	(2,037		)	—
Recognized actuarial loss (gain)	7,585			8,518			8,362			(384		)	(320		)	149
Settlement loss	—			3,248			—			—			—			—
Curtailment loss	92			739			103			—			—			—
Net periodic benefit cost (credit)	$	9,815		$	12,366		$	7,428		$	(2,220	)	$	(2,148	)	$	963
Other changes in plan assets and benefit obligations recognized in other comprehensive (loss) income:
Net actuarial loss (gain)	$	28,740		$	(4,433	)	$	46		$	1,870		$	(276	)	$	(2,746	)
Prior service cost (credit)	26			114			—			—			—			(16,261		)
Amortization of prior service (cost) credit	(64		)	(29		)	(29		)	2,038			2,037			—
Total recognized in other comprehensive (loss) income (a)	$	28,702		$	(4,348	)	$	17		$	3,908		$	1,761		$	(19,007	)
Total recognized in net periodic benefit cost (credit) and other comprehensive (loss) income	$	38,517		$	8,018		$	7,445		$	1,688		$	(387	)	$	(18,044	)

(a)

Amounts exclude related tax expense of $5.5 million, $2.1 million, and $4.5 million, during 2019, 2018, and 2017, respectively, which are also included in other comprehensive (loss) income.

Schedule of Assumptions Used to Calculate Net Periodic Benefit Cost for Domestic Defined Benefit Pension and Postretirement Benefit Plans

Net periodic benefit cost (credit) for Mattel’s domestic defined benefit pension and postretirement benefit plans was calculated on January 1 of each year using the following assumptions:



	For the Year Ended
	December 31, 2019		December 31, 2018		December 31, 2017
Defined benefit pension plans:
Discount rate	4.1	%	3.4	%	3.9	%
Weighted-average rate of future compensation increases	N/A		N/A		N/A
Long-term rate of return on plan assets	6.0	%	6.0	%	6.3	%
Postretirement benefit plans:
Discount rate	4.1	%	3.4	%	3.9	%
Annual increase in Medicare Part B premium	6.0	%	6.0	%	6.0	%
Health care cost trend rate:
Pre-65	7.0	%	7.3	%	7.0	%
Post-65	6.8	%	7.3	%	7.8	%
Ultimate cost trend rate:
Pre-65	4.5	%	4.5	%	4.5	%
Post-65	4.5	%	4.5	%	4.5	%
Year that the rate reaches the ultimate cost trend rate:
Pre-65	2025		2025		2024
Post-65	2025		2025		2024

Schedule of Changes in Benefit Obligation and Plan Assets for Defined Benefit Pension and Postretirement Benefit Plans

A summary of the changes in benefit obligation and plan assets is as follows:



	Defined Benefit Pension Plans						Postretirement Benefit Plans
	December 31, 2019			December 31, 2018			December 31, 2019			December 31, 2018
	(In thousands)
Change in Benefit Obligation:
Benefit obligation, beginning of year	$	567,502		$	639,319		$	6,201		$	7,752
Service cost	4,479			4,223			1			1
Interest cost	19,309			18,117			201			208
Impact of currency exchange rate changes	1,500			(7,793		)	—			—
Actuarial loss (gain)	72,353			(34,214		)	1,486			(596		)
Benefits paid	(36,991		)	(50,211		)	(2,108		)	(1,164		)
Plan amendments	—			809			—			—
Settlements	—			(2,748		)	—			—
Benefit obligation, end of year	$	628,152		$	567,502		$	5,781		$	6,201
Change in Plan Assets:
Plan assets at fair value, beginning of year	$	401,929		$	460,952		$	—		$	—
Actual return on plan assets	60,721			(18,162		)	—			—
Employer contributions	3,670			18,216			2,108			1,164
Impact of currency exchange rate changes	2,418			(5,554		)	—			—
Benefits paid	(36,991		)	(50,211		)	(2,108		)	(1,164		)
Settlements	—			(3,312		)	—			—
Plan assets at fair value, end of year	$	431,747		$	401,929		$	—		$	—
Net Amount Recognized in Consolidated Balance Sheets:
Funded status, end of year	$	(196,405	)	$	(165,573	)	$	(5,781	)	$	(6,201	)
Current accrued benefit liability	$	(4,593	)	$	(4,395	)	$	(750	)	$	(1,090	)
Noncurrent accrued benefit liability	(191,812		)	(161,178		)	(5,031		)	(5,111		)
Net amount recognized	$	(196,405	)	$	(165,573	)	$	(5,781	)	$	(6,201	)
Amounts Recognized in Accumulated Other Comprehensive Loss (a):
Net actuarial loss (gain)	$	266,714		$	238,862		$	(1,201	)	$	(3,071	)
Prior service cost (credit)	182			220			(12,186		)	(14,224		)
	$	266,896		$	239,082		$	(13,387	)	$	(17,295	)

(a)

Amounts exclude related tax benefits of $84.5 million and $79.0 million for December 31, 2019 and 2018, respectively, which are also included in accumulated other comprehensive loss.

Schedule of Assumptions Used to Determine Projected and Accumulated Benefit Obligations of Domestic Defined Benefit Pension and Postretirement Benefit Plans

The assumptions used in determining the projected and accumulated benefit obligations of Mattel’s domestic defined benefit pension and postretirement benefit plans are as follows:



	December 31, 2019		December 31, 2018
Defined benefit pension plans:
Discount rate	3.0	%	4.1	%
Weighted-average rate of future compensation increases	N/A		N/A
Postretirement benefit plans:
Discount rate	3.0	%	4.1	%
Annual increase in Medicare Part B premium	6.0	%	6.0	%
Health care cost trend rate:
Pre-65	7.0	%	7.0	%
Post-65	6.8	%	6.8	%
Ultimate cost trend rate:
Pre-65	4.5	%	4.5	%
Post-65	4.5	%	4.5	%
Year that the rate reaches the ultimate cost trend rate:
Pre-65	2026		2025
Post-65	2026		2025

Schedule of Estimated Future Benefit Payments for Defined Benefit Pension and Postretirement Benefit Plans

The estimated future benefit payments for Mattel’s defined benefit pension and postretirement benefit plans are as follows:



	Defined Benefit Pension Plans		Postretirement Benefit Plans
	(In thousands)
2020	$	37,686	$	750
2021	37,456		750
2022	39,617		650
2023	38,545		650
2024	38,912		650
2025–2027	175,229		2,440

Schedule of Plan Assets Measured and Reported in Financial Statements at Fair Value

Mattel’s defined benefit pension plan assets are measured and reported in the consolidated financial statements at fair value using inputs, which are more fully described in "Note 11 to the Consolidated Financial Statements—Fair Value Measurements," as follows:



	December 31, 2019
	Level 1		Level 2		Level 3		Total
	(In thousands)
U.S. government and U.S. government agency securities	$	—	$	16,196	$	—	$	16,196
U.S. corporate debt instruments	—		57,669		—		57,669
International corporate debt instruments	—		14,088		—		14,088
Mutual funds (a)	—		—		—		74,750
Money market funds	618		—		—		618
Other investments	—		14,952		—		14,952
Insurance "buy-in" policy	—		—		31,281		31,281
Collective trust funds (a):
U.S. equity securities							78,170
International equity securities							89,381
International fixed income							15,387
Diversified funds							39,255
Total	$	618	$	102,905	$	31,281	$	431,747



	December 31, 2018
	Level 1		Level 2		Level 3		Total
	(In thousands)
U.S. government and U.S. government agency securities	$	—	$	8,803	$	—	$	8,803
U.S. corporate debt instruments	—		45,714		—		45,714
International corporate debt instruments	—		13,034		—		13,034
Mutual funds	610		—		—		610
Money market funds	303		—		—		303
Other investments	—		7,964		—		7,964
Insurance "buy-in" policy	—		—		29,857		29,857
Collective trust funds (a):
U.S. equity securities							69,699
International equity securities							176,103
International fixed income							14,752
Diversified funds							35,090
Total	$	913	$	75,515	$	29,857	$	401,929

(a)

These investments consist of privately placed funds that are valued based on net asset value per share. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the statement of financial position and its related disclosures.

Schedule of Assets Measured at Fair Value on a Recurring Basis Using Unobservable Inputs

The following table provides a reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3):



	Level 3
	(in thousands)
Balance at December 31, 2017	$	33,553
Purchases, sales, and settlements (a)	—
Change in fair value	(3,696		)
Balance at December 31, 2018	29,857
Purchases, sales, and settlements (a)	—
Change in fair value	1,424
Balance at December 31, 2019	$	31,281

(a)

There were no purchases, sales, or settlements of Level 3 assets, or transfers in or out of Level 3, for the years ended December 31, 2019 and December 31, 2018.