MANUFACTURING

Hasbro revenue falls 7% in 2Q

BLOOMBERG FILE PHOTO/ MICHAEL SPRINGER
NEGATIVE CURRENCY ADJUSTMENTS helped drive down Hasbro's second-quarter profit by more than 25 percent.
Posted 7/23/12

PAWTUCKET – Revenue for Hasbro Inc. fell 7 percent to $811.5 million in the second quarter of 2012 compared with $908.5 million for the same 2011 period.

Second quarter 2012 earnings were $43.4 million, or 33 cents per diluted share, a decline of 25.3 percent from $58.1 million, or 42 cents per diluted share, during the second quarter of 2011. The company’s results were hurt to the tune of $34.4 million by exchange rate fluctuations.

The toy and game maker’s second-quarter profit included a favorable tax adjustment of $20.5 million, or 15 cents per diluted share, and a pre-tax expense of $13.1 million, or 6 cents per diluted share. These costs were related to establishing Hasbro’s Gaming Center of Excellence.

According to the company, without these costs, second-quarter earnings were $46 million or 33 cents per share.

“2012 continues to develop in line with our expectations as we shift more of our shipments later in the year while improving profitability in the near term,” Brian Goldner, Hasbro president and CEO, said in prepared remarks.

“In the U.S. and Canada, we have gained share and the teams are focused on returning to historical levels of operating profit as well as partnering with U.S. retailers to shift shipments closer to the peak consumer demand periods in the third and fourth quarters,” added Goldner. “Internationally, we continue our global expansion, leveraging investments in emerging markets, product innovation and entertainment to drive Hasbro brands globally.”

U.S. and Canada segment revenue was $406.6million, a decrease of $98.4 million, or 19 percent, when compared with 2011 numbers. The segment reported an operating profit of $60.9 million, a 6 percent increase from the $57.7 million operating profit reported for the second quarter of 2011.

International segment revenue for the Pawtucket-based company shrank $14 million, or 4 percent, to $360.5 million, compared with $374.5 million in the second quarter of 2011.

Operating profit in the international segment shrank 12 percent from $33.8 million during the second quarter of 2011 to $29.9 million for the three months ended July 1, 2012.

Entertainment and licensing segment revenue increased 59 percent to $43.2 million, compared with $27.2 million in 2011. Hasbro saw operating profits in its entertainment and licensing segment rise more than 10 fold to $8.2 million.

“As we enter the second half of 2012, Hasbro is in a strong financial position with healthy cash flow and great initiatives for the holidays,” Hasbro Chief Financial Officer Deborah Thomas said in a statement.

“A year ago, we made an investment in games, establishing Hasbro’s Gaming Center of Excellence,” added Thomas. “One year later we believe we are well positioned with innovative gaming products and strong marketing programs for the holiday season.”

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