Hasbro Beats Earnings Expectations

By MAE ANDERSON

posted: 126 DAYS 14 HOURS AGO

filed under: Earnings

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NEW YORK (July 20) - Toy maker Hasbro Inc. said Monday its second-quarter profit rose 5 percent, beating expectations, as robust sales of Transformers and G.I. Joe toys — both tied to summer movies — helped offset international sales hurt by the stronger dollar.

Profit for the three months ended June 28 rose to $39.3 million, or 26 cents per share, from $37.5 million, or 25 cents per share, last year. Excluding costs related to a joint venture with Discovery Communications to form a TV network, income was 32 cents per share.

Revenue edged up 1 percent to $792.2 million from $784.3 million last year. Excluding the adverse affect of the stronger dollar, net revenue rose 7 percent.

Analysts polled by Thomson Reuters predicted a profit of 23 cents per share on revenue of $797.1 million.

In the U.S. and Canada, sales rose 5 percent to $490.9 million from $467.7 million, boosted by sales of Transformers and G.I. Joe toys. "Transformers: Revenge of the Fallen" came out earlier this month, and "G.I. Joe: The Rise of the Cobra," debuts in August. Other strong sellers in the region were Littlest Pet Shop, Nerf, Play-Doh and Furreal Friends.

Internationally, sales fell 6 percent to $276.2 million from $293.7 million, hurt by the stronger dollar. Transformers and G.I. Joe toys were also among the better sellers internationally.

Hasbro also said the joint TV network with Discovery Communications will cost less than previously expected. The Pawtucket, R.I.-based company now expects it will hurt 2009 earnings by 15 cents to 20 cents per share, compared with a previous estimate of 25 cents to 30 cents per share.

Hasbro expects the project to hurt 2010 earnings by 25 cents to 30 cents per share, compared with the 30 cents to 35 cents per share previously forecast.

The second quarter is a seasonally small one for toymakers, who make up to 50 percent of annual sales during the holiday season. On Friday, rival Mattel Inc. — light on summer-movie tie-in toys this year — said its sales sank 19 percent in quarter, but cost cuts and lower inventory helped it post an 82 percent jump in profit, beating analyst expectations.

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2009-07-20 08:48:07