Hasbro has pointed the finger at the liquidation of Toys R Us as the reason behind its first quarter revenue decrease to $716.3m for 2018.
The global toymaker has posted a net loss of $112.5 million which includes after-tax expenses of $61.4 million associated with Toys R Us, $15.7 million of severance costs and a net charge of $47.8 million related to the US tax reform.
Last year, Hasbro posted a first quarter total of $849.7 million.
Hasbro’s chairman and chief executive officer, Brian Goldner has praised the team’s efforts in what he has billed a ‘challenging first quarter.’
“Hasbro’s brands are resonating with consumers and consumer takeaway is positive,” he said. “However, as we discussed earlier in the year, our first quarter was expected to be difficult. We are working to put the near-term disruption from Toys R Us behind us.
“Our global retailers view this as an opportunity in a key consumer category and are partnering with Hasbro to develop growth plans for our brands. New Hasbro initiatives shipping I this quarter and beyond won’t be caught up in the Toys R Us liquidation process.
“With the rapid shift to a converged retail environment, we accelerated plans we originally had spread throughout the year to transform our commercial organisation on a more immediate basis.”
According to the company’s chief financial officer, Deborah Thomas, Hasbro is ‘positioned to manage a challenging 2018 and drive growth in 2019 and beyond.’
“The quarter’s revenue and profits were negatively impacted by lower revenues and higher expenses associated with events that do not reflect the health of our underlying business,” we said.
“We remain on track to meet our goal of generating $600 to $700 million in operating cash flow this year while investing to build our brands, transform our organisation and return cash to shareholders.”
Hasbro saw its entertainment and licensing segment net revenues increase 21 per cent to $64 million compared to $52.7 million in 2017. Partner Brand revenues declined six per cent to $200.6 million, Hasbro Gaming revenue decreased by 22 per cent to $105.2 million and Emerging Brands revenue declined six per cent to $48.8 million.