PAWTUCKET, R.I.--(BUSINESS WIRE)--
Hasbro,
Inc. (NASDAQ: HAS) today announced preliminary full-year 2012
results.
"In 2012, we met many of the objectives we set for Hasbro," said Brian
Goldner, Hasbro's President and Chief Executive Officer. "Based on
preliminary results, we returned the U.S. and Canada segment to
historical operating profit levels; we grew revenues in the Games
category against our 2012 objective of stabilizing revenues; and we grew
revenues in our Girls category. We also experienced double digit growth
in our emerging markets business and achieved profitability in most
major emerging markets a year ahead of our plan."
"We had a number of strong product initiatives, but consumer demand
through much of the holiday season was less than anticipated in both the
U. S. and certain international markets. As a result, fourth quarter
revenues did not meet our expectations. Despite the lower than
anticipated revenue, we grew our operating profit margin and earnings
per share absent fourth quarter restructuring charges and the impact of
foreign exchange," continued Goldner.
Based on preliminary full-year results, the Company expects to report
earnings per diluted share for 2012, excluding fourth quarter
restructuring charges, in the range of $2.73 to $2.75. This includes an
approximate $0.10 per diluted share negative impact from foreign
exchange in 2012. Absent the unfavorable impact of foreign exchange,
earnings per diluted share excluding fourth quarter restructuring
charges are expected to be in the range of $2.83 to $2.85.
Final 2012 reported earnings will reflect pre-tax restructuring charges
of approximately $37 million recorded in the fourth quarter, or
approximately $0.21 per diluted share, associated with the commencement
of a cost savings initiative the Company is implementing. Additionally,
2012 earnings include $11.1 million, or $0.06 per diluted share, of
previously announced severance costs recorded in the first quarter 2012.
Reported 2012 earnings per diluted share are expected to be in the range
of $2.52 to $2.54.
The Company's reported 2011 earnings per diluted share of $2.82, which
included the impact of a $20.5 million favorable tax adjustment, or
$0.15 per diluted share, and pre-tax expense of $14.4 million, or $0.07
per diluted share, related to costs associated with establishing
Hasbro's Gaming Center of Excellence in Rhode Island. Earnings per
diluted share for 2011 excluding these two items were $2.74.
|
Per diluted share
|
|
As Reported Earnings Per Share
|
|
Approximate Impact of Foreign Exchange
(FX)
|
|
Q4 12 Restructuring Charges
|
|
Adjusted EPS Excluding Impact of FX & Q4
12 Charges
|
|
Other, Net (1)
|
|
EPS Excluding Charges and Benefit
|
2012 (Estimated)
|
|
$2.52 - $2.54 |
|
($0.10) |
|
($0.21) |
|
$2.83-$2.85 |
|
($0.06) |
|
$2.89 - $2.91 |
2011 (Actual)
|
|
$2.82 |
|
N/A
|
|
N/A
|
|
$2.82 |
|
$0.08 |
|
$2.74 |
The Company expects to report full-year 2012 revenues of approximately
$4.09 billion, compared to $4.29 billion in 2011. Absent a $99 million
negative impact from foreign exchange, full year 2012 revenues declined
2%. For the fourth quarter 2012, the Company anticipates revenues to be
approximately $1.28 billion, including a negative $8 million impact from
foreign exchange, compared to $1.33 billion in 2011.
"As we execute our branded play strategy, we are doing so in an industry
with challenging growth prospects in certain geographies. During the
fourth quarter we established a plan to deliver $100 million of annual
cost savings by 2015. This plan focuses our efforts around developing
content-rich brand initiatives consumers and retailers are responding
to, thereby enabling Hasbro to focus on fewer, more significant global
initiatives and enhancing shareholder returns in the coming years," said
Goldner.
The Company expects to incur charges of approximately $37 million
pre-tax in 2012, and an additional estimated $20-$30 million in 2013
associated with these planned actions to reduce ongoing expenses,
including an approximate 10% reduction in workforce, facility
consolidation and process improvements. These actions are anticipated to
begin to deliver savings in 2013, with full recognition in 2015 as all
aspects of the plan are implemented.
"We fundamentally believe our strategy is sound and we remain confident
in our ability to drive profitable long-term growth through brand
innovation," said Deb Thomas, Chief Financial Officer. "We believe a
reduction in ongoing costs in a challenging environment will deliver the
greatest long-term return to our shareholders."
(1) Other, net for 2012 includes the impact of the $11.1
million severance costs recognized during the first quarter of 2012. 2011
includes the impact of the $20.5 million favorable tax adjustment and
$14.4 million of costs associated with establishing Hasbro's gaming
center of excellence.
Fourth Quarter and Full-Year 2012 Earnings
Conference Call
The Company will provide more detailed information about its fourth
quarter and full-year results, as well as its cost savings initiative,
on Thursday, February 7, 2013 through its regularly scheduled financial
results announcement and conference call. The call will be held at 5:00
PM the same day and the webcast will be available to investors and the
media on Hasbro's Investor Relations home page at http://investor.hasbro.com.
A replay of the call will be available at the same location
approximately 2 hours following completion of the call.
Certain financial and statistical information included in the webcast,
such as information required by Regulation G, will be available at the
time of the webcast in the "Press Releases" section of Hasbro's website
at www.hasbro.com,
under "Investor Relations."
HAS-E
About Hasbro
Hasbro, Inc. (NASDAQ: HAS) is a branded play company providing children
and families around the world with a wide-range of immersive
entertainment offerings based on the Company's world class brand
portfolio. 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, well-known and
beloved brands such as TRANSFORMERS, LITTLEST PET SHOP, NERF, PLAYSKOOL,
MY LITTLE PONY, G.I. JOE, MAGIC: THE GATHERING and MONOPOLY. The
Company's Hasbro Studios develops and produces television programming
for markets around the world. The Hub TV Network is part of a
multi-platform joint venture between Hasbro and Discovery Communications
(NASDAQ: DISCA, DISCB, DISCK), in the U.S. 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.
© 2013 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 2012 and beyond, including with respect to its
revenues, earnings per share, costs and profitability, 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, manufacture, source and ship new and continuing 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
development, manufacturing, marketing, royalty and other costs; (ii)
global economic conditions, including recessions, credit crises or other
economic shocks or downturns affecting the United States, Europe or any
of the Company's other markets which can negatively impact the retail
and/or credit markets, the financial health of the Company's retail
customers and consumers, and consumer and business confidence, and which
can result in lower employment levels, less consumer disposable income,
and lower consumer 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 in an effective manner, (v) other economic and public health
conditions in the markets in which the Company and its customers and
suppliers operate which impact the Company's ability and cost to
manufacture and deliver products, such as higher fuel and other
commodity prices, higher labor costs, higher transportation costs,
outbreaks of disease which affect public health and the movement of
people and goods, and other factors, including government regulations,
which can create potential manufacturing and transportation delays or
impact costs; (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 by the Company's customers in their purchasing or
selling patterns; (viii) greater than expected costs, or unexpected
delays or difficulties, associated with THE HUB TV Network, the
Company's joint venture television network with Discovery
Communications, LLC, Hasbro Studios, or the creation of new content to
appear on THE HUB TV Network and elsewhere; (ix) consumer interest in
and acceptance of THE HUB TV Network, and programming created by Hasbro
Studios, and other factors impacting the financial performance of the
network and Hasbro Studios; (x) greater than expected costs or
unexpected delays or difficulties associated with the creation of
Hasbro's Gaming Center of Excellence and the execution of the Company's
strategy for driving innovation and immersive play experiences in its
gaming business; (xi) unexpected delays or difficulties in the Company's
execution of its plans to drive growth and increased profitability in
its U.S. and Canada business; (xii) the inventory policies of the
Company's retail customers, including retailers' potential decisions to
lower the inventories they are willing to carry, 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 tight and compressed
shipping schedules; (xiii) delays, increased costs or difficulties
associated with any of our planned entertainment initiatives; (xiv) work
stoppages, slowdowns or strikes, which may impact the Company's ability
to manufacture or deliver product in a timely and cost-effective manner;
(xv) 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; (xvi) the impact of competition on
revenues, margins and other aspects of the Company's business, including
the ability to secure, maintain and renew popular licenses and the
ability to attract and retain talented employees in a competitive
environment; (xvii) 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 public health conditions and other factors
affecting social and economic activity in China, affecting the movement
of products into and out of China, and impacting the cost of producing
products in China and exporting them to other countries; (xviii) the
risk of product recalls or product liability suits and costs associated
with product safety regulations; (xix) other market conditions, third
party actions or approvals and the impact of 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; (xx) the risk that anticipated
benefits of acquisitions may not occur or be delayed or reduced in their
realization; and (xxi) 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 diluted earnings per share excluding the
impact of changes in foreign exchange rates, restructuring charges
recognized in both 2012 and 2011, and certain discrete income tax
benefits related to the settlement of a tax examination in 2011.
Management believes that the presentation of diluted earnings per share
excluding the impact of exchange rates provides information that is
helpful to an investor's understanding of the underlying business
performance absent exchange rate fluctuations which are beyond the
Company's control. Further, the Company provided the 2012 and 2011
diluted earnings per share absent restructuring charges and favorable
tax adjustment to assist investors in understanding the comparability of
the Company's results.
Hasbro, Inc.
Debbie Hancock, 401-727-5401 (Investor Relations)
or
Wayne
S. Charness, 401-727-5983 (News Media)
Source: Hasbro, Inc.
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