NPD Reports '02 Annual Toy Sales Hold Steady;

Strong Growth in Key Categories

PORT WASHINGTON, NEW YORK, February 13, 2003 - Preliminary results by leading market information company, The NPD Group show that while annual 2002 toy sales were flat (off 1 percent) versus the previous year, there were toy categories that demonstrated strong sales gains. Consumers spent $20.3 billion on toys in 2002* versus $20.5 billion in 2001. NPD toy categories such as arts and crafts, games and puzzles, infant/preschool, learning and exploration, models and accessories, and pretend play all saw sales increases during the last half of 2002 (July-Dec.), versus the same time period in 2001. New innovations, selected licensed products and sale prices in fourth quarter 2002 fueled much of the growth.

Arts and crafts sales grew nearly 17 percent in dollar volume during the last half of 2002, compared to last half 2001. Seven out of the top ten arts and crafts sellers were mechanical design items such as Fisher Price's Magna Doodle, which was also the number one item in the arts and crafts category. New introductions in this category over the past two years continue to gain consumer interest and drive this segment's growth.

Games and puzzle sales gained 19 percent in dollar volume during July-Dec. 2002 versus July-Dec. 2001. The impressive growth was due in part to the new phenomenon of Yu-Gi-Oh! card games. Five out of the top 10 best selling games and puzzles were Yu-Gi-Oh! card game items. The Yu-Gi-Oh! Collector Tin was the number 10 best-selling toy overall in 2002. This brand appeals heavily to 'tween boys, who have the pocket money to fuel their appetite for their growing hobby of strategic card playing and collecting.

Another driver in the games and puzzles category was the introduction of Hasbro's Trivial Pursuit, 20th Anniversary Edition, a classic board game updated and targeted to a younger market, one that grew up in the last twenty years and can answer the game's questions from experience. This version was the number one best-selling game and the number five best-selling toy overall in 2002.

"Whether it was board games, plush or action figures, classic properties fared well throughout 2002," said Reyne Rice, director, The NPD Group. "A new focus on movies and nostalgia from the '70s and '80s brought back renewed interest in favorites such as Spider-Man, Star Wars and Care Bears."

Another mover was the models and accessories category, growing nearly 27 percent in the last six months of 2002, compared to one year ago. Growth in the category was driven by Zoids figures by Hasbro. Zoids captured the top five spots as the best selling models in 2002. The category was rejuvenated in 2000 and 2001 by Bandai's Gundam Wing and Irwin's Dragon Ball Z. The category continues to show growth, especially for the 'tween boy demographic, stealing some market share from the traditional action figures category.

The pretend play supercategory posted a nearly 13 percent increase in sales volume during the last half 2002, compared to last half 2001. The number one pretend play product and the number six best selling toy of 2002 was the Spider-Man Dual Web Blaster by ToyBiz, a perfect marriage of license to a product. As the number two best-seller in the category, Star Wars Electric Light Saber swords from Hasbro, revved up role play for little Jedi warriors across the country. Simple role-playing items such as Jakks Pacific's, WWE World Title Belt and Creative Design's Plastic Tiara made it in the top 20 pretend play items for the year.

Among the new toys introduced in 2002, based on dollar sales, Mattel's Rapunzel Barbie and MGA Entertainment's Bratz Funk N Glow Assortment took the number three and five spots respectively, in the overall top best selling toys introduced in 2002. However, Bratz Assortment, introduced in June 2001 was the number one doll in 2002 and the number three best-selling toy in annual 2002. Although the doll supercategory showed a decline in sales in the later half of the year, fashion dolls were still hot during holiday 2002.

"As we move into 2003, we will continue to see toy companies rolling out classics like Strawberry Shortcake and Teenage Mutant Ninja Turtles to capitalize on the nostalgia trend," said Rice. "Other toy companies will be revealing completely new and innovative items that defy categorization at New York ToyFair this week."

Top 10 Best Selling Toys Ranked on Dollars Sold
Annual 2002

Rank

Item Description

Manufacturer

Intro Date

ARP

1

LeapPad Books Asst.

LeapFrog

July '01

$14.10

2

LeapPad

LeapFrog

Sept '99

$42.31

3

Bratz Asst.

MGA Entertainment

June '01

$13.44

4

Hot Wheels Basic Cars

Mattel

<1986

$0.83

5

Trivial Pursuit 20th Edition

Hasbro Games

June '02

$29.42

6

Spider-Man Dual Web Blaster

Toy Biz

Dec '01

$15.29

7

Star Wars Episode II Asst. 1

Hasbro

March '02

$5.35

8

My 1st LeapPad

LeapFrog

Sept '01

$33.43

9

Rapunzel Barbie

Mattel

June '02

$17.27

10

Yu-Gi-Oh! Collector Tin

Konami

Sept. '02

$19.65

Source: The NPD Group / NPD Funworld/ TRSTS

Top 10 Best Selling Toys Ranked on Dollars Sold
Items Introduced in 2002
Annual 2002

Rank

Item Description

Manufacturer

Intro Date

ARP

1

Trivial Pursuit 20th Edition

Hasbro Games

June '02

$29.42

2

Star Wars Episode II Asst. 1

Hasbro

March '02

$5.35

3

Rapunzel Barbie

Mattel

June '02

$17.27

4

Yu-Gi-Oh! Collector Tin

Konami

Sept. '02

$19.65

5

Bratz Funk N Glow Asst.

MGA Entertainment

July '02

$28.03

6

Star Wars II Electric Lightsabers

Hasbro

April '02

$19.66

7

Yu-Gi-Oh! Metal Raider 1st Edition Blister

Konami

July '02

$3.54

8

Yu-Gi-Oh! Magic Ruler Unlimited Blister

Konami

Sept '02

$3.89

9

Bratz Funky Makeover Asst.

MGA Entertainment

July '02

$23.07

10

Bratz Boyz Fall 2002 Asst.

MGA Entertainment

June '02

$12.99

Source: The NPD Group / NPD Funworld/ TRSTS

*Editors Note:
NPD updated the measurement methodology in July 2001 to provide an improved picture of the industry and its trends. As a result of the methodology update, certain size and structure estimates for the industry changed slightly relative to historical reports. NPD adjusted prior estimates to reflect insights provided by the new methodology, and to more accurately assess trends.

The firm's current assessment of year-over-year sales trends for the total industry are as follows:
1999: $19.8 billion
2000: $20.4 billion
2001: $20.5 billion
2002: $20.3 billion

About The NPD Group, Inc.

The NPD Group, Inc. (NPD) is a global market information company that measures product movement and consumer behavior across a broad range of industries -- apparel, automotive products, consumer electronics, cosmetics and fragrances, food, foodservice, footwear, housewares, information technology, interactive entertainment, toys and music. NPD's clients, many in the Fortune 500, use this insight to uncover market opportunities, strengthen channel relationships and benchmark industry performance. Since 1967, NPD has introduced numerous industry firsts, most recently combining and calibrating information from consumer panels and point-of-sale tracking via its flagship services, the NPD Worlds. The firm has offices and affiliations in 60 countries. For more information on The NPD Group, visit http://www.npd.com.

For more information:

Dora Radwick
dora_radwick@npd.com
516-625-6190

Sean P. Dolan
sean_dolan@npd.com
516-625-2288