Hasbro, Inc.
Oct 20, 2014
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Hasbro Reports Revenue and Operating Profit Growth for the Third Quarter 2014

PAWTUCKET, R.I.--(BUSINESS WIRE)-- Hasbro, Inc. (NASDAQ: HAS) today reported financial results for the third quarter 2014. Net revenues for the third quarter 2014 increased 7% to $1.47 billion compared to $1.37 billion in 2013. Foreign exchange had an unfavorable $10.8 million impact on third quarter revenues.

As reported net earnings for the third quarter 2014 were $180.5 million, or $1.40 per diluted share, compared to $126.6 million, or $0.96 per diluted share, in 2013. Adjusted net earnings for the third quarter 2014 were $187.8 million, or $1.46 per diluted share, excluding a pre-tax charge of $11.6 million, or $0.06 per diluted share, related to the restructuring of the Company's investment in the Hub Network joint venture.

In 2013, as reported net earnings for the third quarter included a pre-tax $75.5 million, or $0.50 per diluted share, charge related to an adverse arbitration award; pre-tax $4.1 million, or $0.03 per diluted share, of restructuring and partial pension settlement charges; and a $23.6 million, or $0.18 per diluted share, favorable tax adjustment. Excluding these items, adjusted net earnings for the third quarter 2013 were $172.5 million, or $1.31 per diluted share.

"Our third quarter results continued to reflect the momentum we are building in our franchise brands and key partner brands, the positive results of our investments globally and the benefits of leading with compelling content and storytelling," said Brian Goldner, Hasbro's President and Chief Executive Officer. "In the third quarter, we grew revenues across all operating segments, delivered improved profitability and took strategic steps to grow our brand portfolio and content delivery over the longer term, including forming a new strategic merchandising relationship with Disney Consumer Products for the globally popular Disney Princess and Frozen properties."

"Our third quarter results are indicative of Hasbro's strong financial and competitive position," said Deborah Thomas, Hasbro's Chief Financial Officer. "In this environment of growth and financial strength, we remain focused on improving profitability, returning cash to our shareholders and investing back into our business, through investments in innovation, systems and portfolio expansion across our blueprint."

Third Quarter 2014 Major Segment Performance

          Net Revenues ($ Millions)       Operating Profit ($ Millions)
        Q3 2014       Q3 2013       % Change       Q3 2014       Q3 2013       % Change
U.S. and Canada         $764.3       $735.6       +4%       $169.9       $147.0       +16%
International         $649.3       $582.7       +11%       $116.5       $105.7       +10%
Entertainment and Licensing         $53.4       $48.6       +10%       $0.5       $7.6       -94%
                             

Note: Third Quarter 2014 charges related to the restructuring of the Company's investment in the Hub Network joint venture and third quarter 2013 restructuring and related pension settlement charges and arbitration award charges are in Corporate and Eliminations. See attached table: Restructuring of Equity Method Investment and Restructuring, Pension Settlement and Arbitration Award Charges.

U.S. and Canada segment net revenues increased 4% to $764.3 million compared to $735.6 million in 2013. The segment's results reflect growth in the Boys and the Games categories, partially offset by a decline in the Girls and Preschool categories. The U.S. and Canada segment reported operating profit growth of 16% to $169.9 million versus $147.0 million in 2013.

International segment net revenues increased 11% to $649.3 million compared to $582.7 million in 2013. Revenues grew 13% excluding a negative $9.7 million impact from foreign exchange. Revenues in the International segment reflect 7% growth in Europe, 24% growth in Latin America and 11% growth in the Asia Pacific region, as well as growth in the Boys, Girls and Preschool categories, partially offset by a decline in the Games category. In total, Emerging Markets revenues increased 29%. The International segment reported operating profit of $116.5 million, up 10% versus $105.7 million in 2013.

Entertainment and Licensing segment net revenues increased 10% to $53.4 million compared to $48.6 million in 2013. The segment benefited from growth in lifestyle licensing. The Entertainment and Licensing segment reported operating profit of $0.5 million compared to $7.6 million in 2013, primarily due to the impact of the acceleration of certain programming amortization costs.

Third Quarter and Nine Month 2014 Product Category Performance

          Net Revenues ($ Millions)
        Q3 2014       Q3 2013       % Change       Nine Months 2014       Nine Months 2013       % Change
Boys         $478.5       $392.0       +22%       $1,062.1       $888.5       +20%
Games         $395.2       $387.4       +2%       $841.4       $873.8       -4%
Girls         $407.7       $388.7       +5%       $710.2       $652.9       +9%
Preschool         $188.5       $202.2       -7%       $364.8       $385.2       -5%
                             

Boys category revenues increased 22% to $478.5 million in the third quarter 2014, behind growth in NERF, TRANSFORMERS, MARVEL and STAR WARS products.

Games category revenues increased 2% in the third quarter to $395.2 million. Franchise Brands MAGIC: THE GATHERING and MONOPOLY grew in the third quarter, as did SIMON SWIPE and OPERATION. These gains were partially offset by declines in several brands, including Telepods featuring the ANGRY BIRDS™ STAR WARS® II game, JENGA, BOP-IT and DUELMASTERS.

The Girls category grew 5% in the third quarter 2014 to $407.7 million. Growth in MY LITTLE PONY, MY LITTLE PONY EQUESTRIA GIRLS, NERF REBELLE, FURREAL FRIENDS, LITTLEST PET SHOP and the introduction of PLAY-DOH DOHVINCI helped fuel continued growth in the category. Declines in FURBY partially offset these revenue gains.

Preschool category revenues decreased 7% to $188.5 million in the third quarter 2014. PLAY-DOH and TRANSFORMERS RESCUE BOTS revenues continued to grow but were more than offset by declines in other Preschool initiatives, including core PLAYSKOOL and SESAME STREET products.

Dividend and Share Repurchase

The Company paid $54.7 million in cash dividends to shareholders during the third quarter 2014 and $162.8 million in the first nine months of 2014. The next quarterly cash dividend payment of $0.43 per common share is payable on November 17, 2014 to shareholders of record at the close of business on November 3, 2014.

During the third quarter, Hasbro repurchased a total of 2.4 million shares of common stock at a total cost of $124.5 million and an average price of $52.56 per share. Through the first nine months of 2014, the Company repurchased 6.4 million shares of common stock at a total cost of $341.3 million and an average price of $53.57 per share. At quarter-end, $183.6 million remained available in the current share repurchase authorization.

Hub Network Joint Venture

On September 25, Hasbro and Discovery Communications announced Hub Network would become Discovery Family Channel effective October 13, 2014. The network will broaden its programming focus to serve families in primetime and continue to showcase Hasbro Studios award-winning children's content in daytime.

As a result of restructuring the Company's investment in the Hub Network joint venture, the Company recorded a pre-tax charge of $11.6 million, or $0.06 per diluted share, in the third quarter 2014. This net charge is primarily related to the costs associated with recording the fair value of a put/call option exercisable at the end of 2021 that the Company and Discovery entered into related to this transaction.

Conference Call Webcast

Hasbro will webcast its third quarter 2014 earnings conference call at 8:30 a.m. Eastern Time today. To listen to the live webcast and access the accompanying presentation slides, please go to http://investor.hasbro.com. The replay of the call will be available on Hasbro's web site approximately 2 hours following completion of the call.

About Hasbro, Inc.

Hasbro, Inc. (NASDAQ: HAS) is a branded play company dedicated to fulfilling the fundamental need for play for children and families through the creative expression of the Company's world class brand portfolio, including TRANSFORMERS, MONOPOLY, PLAY-DOH, MY LITTLE PONY, MAGIC: THE GATHERING, NERF and LITTLEST PET SHOP. From toys and games, to television programming, motion pictures, digital gaming and a comprehensive licensing program, Hasbro strives to delight its global customers with innovative play and entertainment experiences, in a variety of forms and formats, anytime and anywhere. The Company's Hasbro Studios is responsible for entertainment brand-driven storytelling around Hasbro brands across television, film, commercial productions and short-form. Through the Company's deep commitment to corporate social responsibility, including philanthropy, Hasbro is helping to build a safe and sustainable world for future generations and to positively impact the lives of millions of children and families every year. It has been recognized for its efforts by being named one of the "World's Most Ethical Companies" and is ranked as one of Corporate Responsibility Magazine's "100 Best Corporate Citizens." Learn more at www.hasbro.com.

© 2014 Hasbro, Inc. All Rights Reserved.

Certain statements in this release contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include expectations concerning the Company's potential performance in the future, including with respect to anticipated future benefits from investments in the Company's business and strategic efforts to grow the Company's brand portfolio and content delivery over the longer-term, and the Company's ability to achieve its other financial and business goals and may be identified by the use of forward-looking words or phrases. The Company's actual actions or results may differ materially from those expected or anticipated in the forward-looking statements due to both known and unknown risks and uncertainties. Specific factors that might cause such a difference include, but are not limited to: (i) the Company's ability to design, develop, produce, manufacture, source and ship products on a timely and cost-effective basis, as well as interest in and purchase of those products by retail customers and consumers in quantities and at prices that will be sufficient to profitably recover the Company's costs; (ii) downturns in economic conditions affecting the Company's markets which can negatively impact the Company's retail customers and consumers, and which can result in lower employment levels, lower consumer disposable income and spending, including lower spending on purchases of the Company's products; (iii) other factors which can lower discretionary consumer spending, such as higher costs for fuel and food, drops in the value of homes or other consumer assets, and high levels of consumer debt; (iv) potential difficulties or delays the Company may experience in implementing cost savings and efficiency enhancing initiatives; (v) other economic and public health conditions or regulatory changes in the markets in which the Company and its customers and suppliers operate which could create delays or increase the Company's costs, such as higher commodity prices, labor costs or transportation costs, or outbreaks of disease; (vi) currency fluctuations, including movements in foreign exchange rates, which can lower the Company's net revenues and earnings, and significantly impact the Company's costs; (vii) the concentration of the Company's customers, potentially increasing the negative impact to the Company of difficulties experienced by any of the Company's customers or changes in their purchasing or selling patterns; (viii) consumer interest in and acceptance of the Discovery Family Channel, and programming created by Hasbro Studios, and other factors impacting the financial performance of the network and Hasbro Studios; (ix) the inventory policies of the Company's retail customers, including retailers' potential decisions to lower their inventories, even if it results in lost sales, as well as the concentration of the Company's revenues in the second half and fourth quarter of the year, which coupled with reliance by retailers on quick response inventory management techniques increases the risk of underproduction of popular items, overproduction of less popular items and failure to achieve compressed shipping schedules; (x) delays, increased costs or difficulties associated with any of our or our partners' planned digital applications or media initiatives; (xi) work disruptions, which may impact the Company's ability to manufacture or deliver product in a timely and cost-effective manner; (xii) the bankruptcy or other lack of success of one of the Company's significant retailers which could negatively impact the Company's revenues or bad debt exposure; (xiii) the impact of competition on revenues, margins and other aspects of the Company's business, including the ability to offer Company products which consumers choose to buy instead of competitive products, the ability to secure, maintain and renew popular licenses and the ability to attract and retain talented employees; (xiv) concentration of manufacturing for many of the Company's products in the People's Republic of China and the associated impact to the Company of social, economic or public health conditions and other factors affecting China, the movement of products into and out of China, the cost of producing products in China and exporting them to other countries; (xv) the risk of product recalls or product liability suits and costs associated with product safety regulations; (xvi) the impact of other market conditions, third party actions or approvals and competition which could reduce demand for the Company's products or delay or increase the cost of implementation of the Company's programs or alter the Company's actions and reduce actual results; (xvii) the impact of litigation or arbitration decisions or settlement actions; and (xviii) other risks and uncertainties as may be detailed from time to time in the Company's public announcements and Securities and Exchange Commission ("SEC") filings. The Company undertakes no obligation to make any revisions to the forward-looking statements contained in this release or to update them to reflect events or circumstances occurring after the date of this release.

This press release includes a non-GAAP financial measure as defined under SEC rules, specifically EBITDA. EBITDA represents net earnings attributable to Hasbro, Inc. excluding net loss attributable to noncontrolling interests, interest expense, income taxes, depreciation and amortization. As required by SEC rules, we have provided reconciliation on the attached schedule of this measure to the most directly comparable GAAP measure. Management believes that EBITDA is one of the appropriate measures for evaluating the operating performance of the Company because it reflects the resources available for strategic opportunities including, among others, to invest in the business, strengthen the balance sheet, and make strategic acquisitions. However, this measure should be considered in addition to, not as a substitute for, or superior to, net earnings or other measures of financial performance prepared in accordance with GAAP as more fully discussed in the Company's financial statements and filings with the SEC. As used herein, "GAAP" refers to accounting principles generally accepted in the United States of America.

The press release also includes the Company's costs and expenses, operating profit, net earnings and diluted earnings per share excluding the impact of the restructuring of the Company's investment in the HUB Network joint venture in 2014 and the impact of an adverse arbitration award, restructuring and related pension charges, and certain favorable tax adjustments in 2013. Management believes that presenting this data excluding these charges and tax adjustments assists investors in understanding the performance of the Company's underlying business and the results of operations.

HAS-E

 
 
HASBRO, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
         
(Thousands of Dollars)
Sept. 28, 2014 Sept. 29, 2013
ASSETS
Cash and Cash Equivalents $ 452,184 $ 588,668
Accounts Receivable, Net 1,314,022 1,215,289
Inventories 499,150 447,113
Other Current Assets   380,833   346,215
Total Current Assets 2,646,189 2,597,285
Property, Plant and Equipment, Net 228,019 231,199
Other Assets   1,634,594   1,761,661
Total Assets $ 4,508,802 $ 4,590,145
 
 

LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND SHAREHOLDERS' EQUITY

Short-term Borrowings $ 78,023 $ 212,926
Current Portion of Long-term Debt - 430,424
Payables and Accrued Liabilities   936,005   1,005,529
Total Current Liabilities 1,014,028 1,648,879
Long-term Debt 1,559,895 959,895
Other Liabilities   392,366   410,672
Total Liabilities 2,966,289 3,019,446
Redeemable Noncontrolling Interests 43,949 47,269
Total Shareholders' Equity   1,498,564   1,523,430

Total Liabilities, Redeemable Noncontrolling Interests and Shareholders' Equity

$ 4,508,802 $ 4,590,145
 
 
HASBRO, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
      Quarter Ended       Nine Months Ended
                       
(Thousands of Dollars and Shares Except Per Share Data)

Sept. 28,
2014

% Net
Revenues

Sept. 29,
2013

% Net
Revenues

Sept. 28,
2014

% Net
Revenues

Sept. 29,
2013

% Net
Revenues

Net Revenues $ 1,469,899 100.0 % $ 1,370,348 100.0 % $ 2,978,614 100.0 % $ 2,800,384 100.0 %
Costs and Expenses:
Cost of Sales 602,766 41.0 % 568,582 41.5 % 1,181,647 39.7 % 1,136,724 40.6 %
Royalties 94,352 6.4 % 143,947 10.5 % 214,466 7.2 % 243,568 8.8 %
Product Development 58,220 4.0 % 59,366 4.3 % 157,184 5.3 % 154,455 5.5 %
Advertising 147,492 10.0 % 136,487 10.0 % 296,444 10.0 % 277,278 9.9 %
Amortization of Intangibles 12,809 0.9 % 14,224 1.0 % 38,103 1.3 % 37,677 1.3 %
Program Production Cost Amortization 24,374 1.7 % 17,991 1.3 % 35,742 1.2 % 34,023 1.2 %
Selling, Distribution and Administration   244,072   16.6 %   231,045   16.9 %   643,202   21.6 %   633,238   22.6 %
Operating Profit 285,814 19.4 % 198,706 14.5 % 411,826 13.8 % 283,421 10.1 %
Interest Expense 24,710 1.7 % 41,194 3.0 % 69,940 2.3 % 86,398 3.0 %
Other (Income) Expense, Net   17,050   1.2 %   1,599   0.1 %   7,320   0.2 %   6,527   0.3 %
Earnings before Income Taxes 244,054 16.6 % 155,913 11.4 % 334,566 11.2 % 190,496 6.8 %
Income Taxes   63,899   4.3 %   30,070   2.2 %   90,077   3.0 %   34,844   1.2 %
Net Earnings 180,155 12.3 % 125,843 9.2 % 244,489 8.2 % 155,652 5.6 %
Net Loss Attributable to Noncontrolling Interests   (302 ) 0.0 %   (731 ) 0.0 %   (1,530 ) -0.1 %   (731 ) 0.0 %
Net Earnings Attributable to Hasbro, Inc. $ 180,457   12.3 % $ 126,574   9.2 % $ 246,019   8.3 % $ 156,383   5.6 %
 
Per Common Share
Net Earnings Attributable to Hasbro, Inc.
Basic $ 1.42   $ 0.97   $ 1.90   $ 1.20  
Diluted $ 1.40   $ 0.96   $ 1.88   $ 1.19  
 
Cash Dividends Declared $ 0.43   $ 0.40   $ 1.29   $ 1.20  
 
Weighted Average Number of Shares
Basic   127,293     130,253     129,302     129,972  
Diluted   128,703     131,845     130,789     131,573  
 
 
HASBRO, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

(Thousands of Dollars)

           
Nine Months Ended
Sept. 28, 2014 Sept. 29, 2013
Cash Flows from Operating Activities:
Net Earnings $ 244,489 $ 155,652
Non-cash Adjustments 144,320 168,429
Changes in Operating Assets and Liabilities   (361,983 )   (276,764 )
Net Cash Provided by Operating Activities   26,826     47,317  
 
Cash Flows from Investing Activities:
Additions to Property, Plant and Equipment (78,255 ) (78,246 )
Investments and Acquisitions, Net of Cash Acquired 64,400 (109,955 )
Other   4,009     3,121  
Net Cash Utilized by Investing Activities   (9,846 )   (185,080 )
 
Cash Flows from Financing Activities:
Proceeds from Borrowings with Maturity Greater Than 3 Months 559,986 -
Repayments of Borrowings with Maturity Greater Than 3 Months (425,000 ) -
Net Proceeds from (Repayments of) Short-term Borrowings 71,172 (11,235 )
Purchases of Common Stock (338,184 ) (86,972 )
Stock-based Compensation Transactions 51,954 87,172
Dividends Paid   (162,789 )   (104,164 )
Net Cash Utilized by Financing Activities   (242,861 )   (115,199 )
 
Effect of Exchange Rate Changes on Cash (4,384 ) (8,071 )
 
Cash and Cash Equivalents at Beginning of Year   682,449     849,701  
 
Cash and Cash Equivalents at End of Period $ 452,184   $ 588,668  
 
 
HASBRO, INC.
SUPPLEMENTAL FINANCIAL DATA

(Unaudited)

(Thousands of Dollars)       Quarter Ended           Nine Months Ended    
  Sept. 28, 2014     Sept. 29, 2013

%
Change

Sept. 28, 2014     Sept. 29, 2013

%
Change

Major Segment Results

U.S. and Canada Segment:

External Net Revenues $ 764,268 $ 735,619 4 % $ 1,484,968 $ 1,466,921 1 %
Operating Profit 169,850 146,991 16 % 252,541 243,738 4 %
Operating Margin 22.2 % 20.0 % 17.0 % 16.6 %
 

International Segment:

External Net Revenues 649,284 582,676 11 % 1,351,608 1,212,665 11 %
Operating Profit 116,451 105,663 10 % 148,097 115,951 28 %
Operating Margin 17.9 % 18.1 % 11.0 % 9.6 %
 

Entertainment and Licensing Segment:

External Net Revenues 53,378 48,637 10 % 135,915 114,747 18 %
Operating Profit 493 7,625 -94 % 21,120 16,622 27 %
Operating Margin 0.9 % 15.7 % 15.5 % 14.5 %
 

International Segment Net Revenues by Major Geographic Region

Europe $ 403,602 $ 376,648 7 % $ 827,412 $ 755,097 10 %
Latin America 163,163 131,914 24 % 313,466 260,443 20 %
Asia Pacific   82,519     74,114   11 %   210,730     197,125   7 %
Total $ 649,284   $ 582,676   $ 1,351,608   $ 1,212,665  
 

Net Revenues by Product Category

Boys $ 478,509 $ 392,014 22 % $ 1,062,082 $ 888,494 20 %
Games 395,221 387,450 2 % 841,449 873,774 -4 %
Girls 407,718 388,696 5 % 710,235 652,889 9 %
Preschool   188,451     202,188   -7 %   364,848     385,227   -5 %
Total Net Revenues $ 1,469,899   $ 1,370,348   $ 2,978,614   $ 2,800,384  
 

Reconciliation of EBITDA

Net Earnings Attributable to Hasbro, Inc. $ 180,457 $ 126,574 $ 246,019 $ 156,383
Net Loss Attributable to Noncontrolling Interests (302 ) (731 ) (1,530 ) (731 )
Interest Expense 24,710 41,194 69,940 86,398
Income Taxes 63,899 30,070 90,077 34,844
Depreciation 32,458 32,345 82,536 75,526
Amortization of Intangibles   12,809     14,224     38,103     37,677  
EBITDA $ 314,031   $ 243,676   $ 525,145   $ 390,097  
 
 
HASBRO, INC.
SUPPLEMENTAL FINANCIAL DATA
RESTRUCTURING OF EQUITY METHOD INVESTMENT AND RESTRUCTURING, PENSION SETTLEMENT AND ARBITRATION AWARD CHARGES

(Unaudited)

(Thousands of Dollars)

Operating Profit, Excluding Restructuring of Equity Method Investment and Restructuring, Pension Settlement and Arbitration Award Charges

                 

Quarter Ended Sept. 28, 2014

As Reported

Less
Restructuring of
Equity Method
Investment

Excluding
Restructuring of
Equity Method
Investment

% Net
Revenues

Net Revenues $ 1,469,899 $ - $ 1,469,899 100.0 %
Costs and Expenses:
Cost of Sales 602,766 - 602,766 41.0 %
Royalties 94,352 2,328 96,680 6.6 %
Product Development 58,220 - 58,220 4.0 %
Advertising 147,492 - 147,492 10.0 %
Amortization of Intangibles 12,809 - 12,809 0.9 %
Program Production Cost Amortization 24,374 - 24,374 1.7 %
Selling, Distribution and Administration   244,072   (1,000 )   243,072 16.5 %
Operating Profit $ 285,814 $ 1,328   $ 284,486 19.4 %
 

Nine Months Ended Sept. 28, 2014

As Reported

Less
Restructuring of
Equity Method
Investment

Excluding
Restructuring of
Equity Method
Investment

% Net
Revenues

Net Revenues $ 2,978,614 $ - $ 2,978,614 100.0 %
Costs and Expenses:
Cost of Sales 1,181,647 - 1,181,647 39.7 %
Royalties 214,466 2,328 216,794 7.3 %
Product Development 157,184 - 157,184 5.3 %
Advertising 296,444 - 296,444 10.0 %
Amortization of Intangibles 38,103 - 38,103 1.3 %
Program Production Cost Amortization 35,742 - 35,742 1.2 %
Selling, Distribution and Administration   643,202   (1,000 )   642,202 21.6 %
Operating Profit $ 411,826 $ 1,328   $ 410,498 13.8 %
 

Quarter Ended Sept. 29, 2013

As Reported

Less
Restructuring,
Pension
Settlement and
Arbitration
Award Charges

Excluding
Restructuring,
Pension
Settlement and Arbitration Award
Charges

% Net
Revenues

Net Revenues $ 1,370,348 $ - $ 1,370,348 100.0 %
Costs and Expenses:
Cost of Sales 568,582 - 568,582 41.5 %
Royalties 143,947 (57,164 ) 86,783 6.3 %
Product Development 59,366 - 59,366 4.3 %
Advertising 136,487 - 136,487 10.0 %
Amortization of Intangibles 14,224 - 14,224 1.0 %
Program Production Cost Amortization 17,991 - 17,991 1.3 %
Selling, Distribution and Administration   231,045   (4,093 )   226,952 16.6 %
Operating Profit $ 198,706 $ (61,257 ) $ 259,963 19.0 %
 

Nine Months Ended Sept. 29, 2013

As Reported

Less
Restructuring,
Pension
Settlement and
Arbitration
Award Charges

Excluding
Restructuring,
Pension
Settlement and Arbitration Award
Charges

% Net
Revenues

Net Revenues $ 2,800,384 $ - $ 2,800,384 100.0 %
Costs and Expenses:
Cost of Sales 1,136,724 (8,493 ) 1,128,231 40.3 %
Royalties 243,568 (57,164 ) 186,404 6.7 %
Product Development 154,455 (3,515 ) 150,940 5.4 %
Advertising 277,278 - 277,278 9.9 %
Amortization of Intangibles 37,677 - 37,677 1.3 %
Program Production Cost Amortization 34,023 - 34,023 1.2 %
Selling, Distribution and Administration   633,238   (23,473 )   609,765 21.8 %
Operating Profit $ 283,421 $ (92,645 ) $ 376,066 13.4 %
 
 
HASBRO, INC.
SUPPLEMENTAL FINANCIAL DATA
RESTRUCTURING OF EQUITY METHOD INVESTMENT AND RESTRUCTURING, PENSION SETTLEMENT AND ARBITRATION AWARD CHARGES
(Unaudited)

(Thousands of Dollars)

Net Earnings and Earnings per Share Excluding Restructuring of Equity Method Investment, Restructuring Charges, Pension Settlement Charges, Arbitration Award Charges and Benefit from Settlement of Tax Exams

 
      Quarter Ended
Sept. 28, 2014    

Diluted Per
Share Amount

    Sept. 29, 2013    

Diluted Per
Share Amount

Net Earnings Attributable to Hasbro, Inc., as Reported $ 180,457 $ 1.40 $ 126,574 $ 0.96
Restructuring of Equity Method Investment, Net of Tax 7,379 0.06 - -
Restructuring Charges, Net of Tax - - 2,447 0.02
Pension Settlement Charges, Net of Tax - - 679 0.01
Arbitration Award Charges, Net of Tax - - 66,447 0.50
2013 Benefit from Tax Exam Settlement   -     -   (23,637 )   (0.18 )
Net Earnings Attributable to Hasbro, Inc., as Adjusted $ 187,836   $ 1.46 $ 172,510   $ 1.31  
 
Nine Months Ended
Sept. 28, 2014

Diluted Per
Share Amount

Sept. 29, 2013

Diluted Per
Share Amount

Net Earnings Attributable to Hasbro, Inc., as Reported $ 246,019 $ 1.88 $ 156,383 $ 1.19
Restructuring of Equity Method Investment, Net of Tax 7,379 0.06 - -
Restructuring Charges, Net of Tax - - 21,224 0.16
Pension Settlement Charges, Net of Tax - - 2,469 0.02
Arbitration Award Charges, Net of Tax - - 66,447 0.50
2013 Benefit from Tax Exam Settlement   -     -   (23,637 )   (0.18 )
Net Earnings Attributable to Hasbro, Inc., as Adjusted $ 253,398   $ 1.94 $ 222,886   $ 1.69  
 

Restructuring of Equity Method Investment and Restructuring, Pension Settlement and Arbitration Award Charges - by Segment

Quarter Ended Nine Months Ended

Sept. 28, 2014

Sept. 29, 2013

Sept. 28, 2014

Sept. 29, 2013

Entertainment and Licensing Segment $ - $ - $ - $ 1,729
Corporate and Eliminations   (1,328 )   61,257   (1,328 )   90,916  
Total $ (1,328 ) $ 61,257 $ (1,328 ) $ 92,645  

Hasbro, Inc.
Investor Contact:
Debbie Hancock, 401-727-5401
debbie.hancock@hasbro.com
or
Press Contact:
Julie Duffy, 401-727-5931
julie.duffy@hasbro.com

Source: Hasbro, Inc.

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