Hasbro Reports Q2
Hasbro, Inc., reported financial results for the second quarter 2016. Net revenues for the second quarter 2016 increased 10 percent to $878.9 million versus $797.7 million in 2015. Excluding a negative $17.7 million impact from foreign exchange, second quarter revenues increased 12 percent. Net earnings for the second quarter 2016 increased 25 percent to $52.1 million, or $0.41 per diluted share, compared to $41.8 million, or $0.33 per diluted share, in 2015.
“Hasbro’s focus on building brands, telling great stories, and creating the best play experiences in toys, games, digital gaming, and consumer products is driving strong consumer and retailer demand for our brands globally,” said Brian Goldner, Hasbro’s chairman, president and CEO. “The excellent execution of our team continues to deliver revenue and earnings growth, while we are investing in elevating our talent and capabilities around our Brand Blueprint. Our initiatives for the second half of the year feature innovative offerings for Hasbro Franchise Brands and Partner Brands, including newly announced products such as Furby Connect and Speak Out, and support for upcoming major feature films, Lucasfilm’s Rogue One: A Star Wars Story and DreamWorks’ Trolls.”
Second quarter 2016 U.S. and Canada segment net revenues increased 11 percent to $425.9 million compared to $385.2 million in 2015. Growth in the Boys, Girls, and Games categories more than offset a decline in the Preschool category. The U.S. and Canada segment reported operating profit growth of 23 percent to $58 million, or 13.6 percent of net revenues, compared to $47.1 million, or 12.2 percent of net revenues, in 2015.
International segment net revenues increased 11 percent to $401.1 million compared to $362.8 million in 2015. Revenue growth in the Boys, Girls, and Preschool categories more than offset a decline in the Games category. On a regional basis, Europe grew 23 percent, Latin America declined 1 percent, and Asia Pacific was down 4 percent. Emerging markets revenues increased 5 percent in the quarter. Excluding an unfavorable $17 million impact of foreign exchange (FX), net revenues in the International segment grew 15 percent, increasing 24 percent in Europe ($2.1 million negative FX impact), 11 percent in Latin America ($12.2 million negative FX impact), and was essentially flat in Asia Pacific ($2.7 million negative FX impact). Emerging markets increased approximately 13 percent absent the impact of foreign exchange. As reported, International segment operating profit of $29.7 million was up 17 percent, or 7.4 percent of net revenues, compared to $25.4 million, or 7 percent of net revenues, in 2015.
Entertainment and Licensing segment net revenues increased 9 percent to $51.9 million compared to $47.6 million in 2015, driven by growth in Consumer Products and Digital Gaming. The Entertainment and Licensing segment operating profit increased 86 percent to $13.8 million, or 26.6 percent of net revenues, compared to $7.4 million, or 15.6 percent of net revenues, in 2015.
Second quarter 2016 Boys category revenues increased 4 percent to $355.1 million. Revenue growth in the quarter was driven by gains in Franchise Brand Nerf, along with Partner Brand Star Wars as well as the addition of Yo-Kai Watch.
Games category revenues for the quarter increased 8 percent to $227.7 million. Pie Face, Duel Masters, Yahtzee, Simon, and Bop-It were among the brands contributing to growth in the quarter. Girls’ category revenues increased 35 percent to $172.3 million. Hasbro’s line of Disney Princess and Disney’s Frozen fashion and small dolls along with revenue growth in Baby Alive led the increase in the quarter.
Preschool category revenues increased 5 percent to $123.9 million for the second quarter 2016. Revenue growth in Franchise Brand Play-Doh drove the revenue increase for the quarter.
Dividend and Share Repurchase
Hasbro paid $63.9 million in cash dividends to shareholders during the second quarter 2016. The next quarterly cash dividend payment of $0.51 per common share is scheduled for August 15, 2016, to shareholders of record at the close of business on August 1, 2016.
During the second quarter, Hasbro repurchased 270,611 shares of common stock at a total cost of $21.9 million and an average price of $81 per share. Through the first two quarters, Hasbro repurchased 745,611 shares of common stock at a total cost of $57.8 million and an average price of $77.44 per share. At quarter-end, $421.5 million remained available in the current share repurchase authorization.
Vroom, Daniel Tiger Launch Parent Empowerment Initiative
Vroom, an initiative of the Bezos Family Foundation, has teamed up with The Fred Rogers Company for a sponsorship of the animated PBS Kids series Daniel Tiger’s Neighborhood. The initiative will feature sixteen 15-second underwriting credits created by Vroom to empower parents and caregivers by showing them how to turn the moments they spend with their young children into great brain-building opportunities. The new spots, which begin airing today on PBS Kids, will bookend each episode of the show as Vroom’s recognition videos and feature different tips, incorporating topics such as how to foster creativity and communicate effectively. In addition to messaging on PBS Kids’ broadcast and digital channels, the new partnership will deliver special learning resources directly to parents and caregivers during Daniel Tiger’s Neighborhood Be My Neighbor Day community events, which are taking place in collaboration with 10 PBS stations across the country in 2017.
Disney Reveals Rogue One Figure
Disney says that fans were given a first look at the new toy line for the upcoming Rogue One: A Star Wars Story during a panel for the movie at Star Wars Celebration in London last Friday. Felicity Jones, who plays Jyn Erso revealed her six-inch action figure from Hasbro and was welcomed to the action figure club by panel host Gwendoline Christie, who plays Captain Phasma in Star Wars: The Force Awakens. The action figure will go on sale later this year along with a variety of Rogue One products. The film opens December 16.
The photo, submitted by Disney, is by Ben A. Pruchnie/Getty Images for Walt Disney Studios.