Hasbro Sees Revenue, Operating Profit Gains in Q2

Hasbro’s second quarter revenues increased 11 percent to $972.5 million versus $878.9 million last year, with operating profit up 18 percent to $100 million and a 30 percent rise in net earnings to $67.7 million.

Net revenues for the U.S. and Canada were up 16 percent to $494.4 million compared to $425.9 million in 2016. Revenues grew in franchise brands, partner brands and Hasbro Gaming, but dipped in emerging brands. The U.S. and Canada segment saw operating profit increase 41 percent to $81.6 million, or 16.5 percent of net revenues, compared to $58 million, or 13.6 percent of net revenues, last year.

International segment net revenues rose 6 percent to $426.6 million compared to $401.1 million in 2016. Revenue growth in franchise brands and Hasbro Gaming offset declines in partner brands and emerging brands. Regionally, Europe revenues increased 4 percent, Latin America was up 3 percent and Asia Pacific rose by 18 percent. Emerging markets revenues grew by 7 percent in the quarter. International segment operating profit was down 43 percent to $16.9 million, or 4 percent of net revenues, compared to $29.7 million, or 7.4 percent of net revenues, last year.

Entertainment and licensing segment net revenues dropped 1 percent to $51.5 million compared to $51.9 million in 2016. Growth in digital gaming, led by Backflip Studios, was offset by declines in entertainment revenues. The entertainment and licensing segment operating profit decreased $2.5 million, or 18 percent, to $11.3 million, or 22 percent of net revenues, compared to $13.8 million, or 26.6 percent of net revenues, in 2016.

Brian Goldner, Hasbro’s chairman and CEO, commented: “The Hasbro team executed another very strong quarter across the brand blueprint. Story-led brands and innovative brand initiatives drove double-digit revenue growth and an increase in operating profit margin. Franchise brand, Hasbro Gaming and partner brand revenues grew year-over-year, and revenue increased across all geographic regions. We entered the important second half of the year with strong consumer momentum, a robust and diverse entertainment slate and compelling new brand initiatives.”

Deborah Thomas, Hasbro’s chief financial officer, added: “Our balance sheet and cash flows remain strong. While we are seeing some softness in economic conditions in Brazil and the U.K., our brands continue to resonate with consumers. We are well-positioned with innovative new product driven by strong entertainment as we enter the second half of the year.”