Toy maker Hasbro Inc. (HAS) reported Monday a wider loss in its first quarter, hurt by higher restructuring charges. Adjusted earnings climbed from last year, and topped Street estimates on strong performance in U.S. and Canada region and Games, Girls and Preschool categories.
President and Chief Executive Officer Brian Goldner said, "We entered 2013 with a heightened focus on our brands, organization and profitability, and delivered a good start to the year. Our emerging markets continued to post double-digit revenue gains while the U.S. and Canada team delivered another quarter of revenue growth backed by profitability improvement."
Rival toy maker Mattel, Inc. (MAT) last week reported that its first-quarter profit surged nearly five times from last year, benefited by strong performance in its girls' brands, including Monster High and American Girl Brands, and improved margins.
In its recently concluded first quarter, Hasbro's net loss was $6.67 million or $0.05 per share, compared to last year's loss of $2.58 million or $0.02 per share. The company said the latest quarter was a 13-week period, compared with the prior year's 14-week period.
The latest quarter results included pre-tax restructuring charges of $28.9 million, or $0.14 per share, as well as favorable tax adjustments of $5.5 million or $0.04 per share. The prior-year's results included $11.1 million or $0.06 per share of restructuring charges.
On an adjusted basis, which excluded items, the company's net earnings climbed 30 percent to $6.6 million or $0.05 per share from $5.1 million or $0.04 per share a year ago. On average, 12 analysts polled by Thomson Reuters expected earnings of $0.04 per share for the quarter. Analysts' estimates typically exclude one-time items.
The firm's net revenues were $663.69 million, 2 percent higher than last year's $648.85 million. Ten analysts estimated revenues of $638.76 million for the quarter. The latest net revenues include a negative $3.3 million impact of foreign exchange.
On a geographical basis, U.S. and Canada net revenues increased 4 percent, reflecting growth in the Girls and Games categories.
Meanwhile, International net revenues were essentially flat on a reported basis, while it grew 1 percent, excluding foreign exchange impact, benefited by growth in Latin America and Asia Pacific as well as the Games, Girls and Preschool categories.
Entertainment and Licensing segment's revenues grew 5 percent, primarily benefited from the sale of television programming.
Product-wise, net revenues in the Boys category decreased 20 percent as good growth in MARVEL, NERF and G.I. JOE product revenues were offset by difficult comparisons in several other brands.
The Games category continued its positive momentum, posting 26 percent revenue growth. Girls category's revenue increased 23 percent. Revenues from Preschool category grew 8 percent as PLAY-DOH and PLAYSKOOL HEROES brands continued its growth.
Brand innovation and new initiatives delivered gains in the Girls and Preschool categories.
Regarding its ongoing cost savings initiative aiming for $100 million in annual savings by 2015, the company said it currently expects full-year charges of $30 million to $35 million, prior to potential pension charges of up to $10 million.
Hasbro shares closed Friday's trading at $45.02, up $0.68 or 1.53 percent.
For comments and feedback: editorial@rttnews.com