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manufacturing

Hasbro profit drops in 4Q, 2012

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PAWTUCKET – Profit for Hasbro Inc. fell 6.4 percent to $130.3 million, or 99 cents per diluted share, in the fourth quarter of 2012 and 12.8 percent to $336 million, or $2.55 per diluted share, for 2012 as a whole, the company announced after markets closed Thursday.

Hasbro’s fourth quarter 2012 revenue was $1.28 billion, a 3.5 percent decline from the $1.33 billion reported for the fourth quarter of 2011. For the year as a whole, Hasbro saw revenue drop 4.6 percent to $4.09 billion from $4.29 billion.

“In 2012, we achieved many important objectives for the year, including improving the U.S. and Canada segment operating profit margin to 15.1 percent, growing our games and girls categories and driving 16 percent revenue growth in the emerging markets while improving profitability,” Brian Goldner, Hasbro president and CEO, said in prepared remarks.

“We did, however, face difficult year-over-year comparisons and a challenging holiday season in certain geographies,” Goldner added.

The toy-and-game maker’s net revenue dropped 6 percent in the U.S. and Canada region and 4 percent internationally. Still, the company reported operating profit of $319.1 million, a gain of 15 percent, in the U.S. and Canada segment. Internationally, operating profit fell 20 percent to $215.5 million.

Hasbro, which released its preliminary fourth-quarter and year-end earnings estimates on Jan. 25, announced the decision to cut its global workforce by roughly 10 percent, a loss of about 600 jobs.

In product categories for 2012, Hasbro saw net revenue drop 13 percent in the boys segment to $1.6 billion while falling 5 percent in the preschool segment to $527.6 million. On the brighter side, the company’s games segment revenue increased 2 percent to $1.2 billion, as the girls segment rose 7 percent to $792.3 million.

“Hasbro remains in a strong financial position,” Deborah Thomas, Hasbro’s chief financial officer, said in a statement, a statement supported in part by a 35 percent increase in 2012 of cash provided by operating activities to $534.8 million.

“We are taking steps we believe necessary to lower our cost base and better align our resources behind our greatest long-term opportunities,” added Thomas. “We remain committed to investing in the long-term growth of Hasbro and delivering strong shareholder returns including our dividend and share repurchase program. Our ability to raise the dividend for the ninth time in 10 years is based on the confidence we have in the long-term prospects for Hasbro.”

The company declared a quarterly cash dividend of 40 cents per common share, an 11 percent increase from the third-quarter dividend of 36 cents per common share.

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