Hasbro Q2 is better than expected

Katie Roberts

By Katie Roberts

July 20th 2009 at 1:13PM
Hasbro Q2 is better than expected

Hasbro has reported an increase in sales of one per cent to $792.2 million, compared to $784.3 million a year ago.

Excluding the negative $44.5 million impact of foreign exchange, net sales increased seven per cent.

Net profit for the period increased to $39.3 million, or 26 cents per share, from $37.5 million or 25 cents per share in 2008.

The second quarter results include a six cents per share dilutive impact from Hasbro’s investment in its joint venture with Discovery Communications.

Brian Goldner, president and chief executive officer said: “Hasbro performed well in what continues to be a challenging global environment.

“Our ability to deliver growth in both revenue and earnings per share, while including the dilution from the investment in our joint venture with Discovery Communications, was due to broad based strength across Hasbro’s core brand product portfolio and strong execution globally."

US and Canada sales were $490.9 million, compared to $467.7 million in 2008. The results reflect growth in Transformers, GI Joe, Littlest Pet Shop, Nerf, Play-Doh, Furreal Friends and Tonka. The segment reported an operating profit of $56.3 million, compared to $43.7 million in 2008.

International segment sales fell to $276.2 million, compared to $293.7 million in 2008. The revenues include a negative foreign exchange impact of approximately $42.8 million.

The results reflect growth in Transformers, G.I. Joe, Littlest Pet Shop, Nerf, Play-Doh and Star Wars. The International segment reported an operating profit of $16.5 million, up from $14 million in 2008.

Entertainment and Licensing segment net revenues rose to $24.2 million, from $21.3 million in 2008. The results reflect increases in Transformers, GI Joe and Nerf.

The Entertainment and Licensing segment reported an operating profit of $2.9 million compared to operating profit of $8 million in 2008. The 2009 results were impacted by one-time expenses associated with the investment in the joint venture with Discovery Communications.

The Entertainment and Licensing segment includes television, movies, lifestyle and digital licensing and on-line entertainment operations.

Deborah Thomas, chief financial officer commented: “Our business performance in 2009 has continued to meet our expectations.

"Our integration of the joint venture with Discovery Communications is on track and we are very pleased with the favourable interest rates we were able to obtain on our recent long-term financing,”

Goldner concluded with the firm's plans for the rest of the year: "For the remainder of this year, we will continue to invest in our business and closely manage our expenses.

"While there are challenges in 2009, we believe that the underlying strength of our brands and our commitment to our strategy should enable Hasbro to grow revenue and earnings per share, including the impact of our television investment -- absent a material deterioration in the global economy and the value of foreign currencies.”