From Yahoo! Business News (originally from Reuters). (Reuters) - Hasbro Inc. , the No. 2 U.S. toy company, on Monday said its quarterly loss narrowed as strong sales of board games and its products such as Playskool, Littlest Pet Shop, Nerf and Transformers offset slower "Star Wars" toy sales.
But Hasbro warned the second quarter will be difficult compared with a year ago when its earnings jumped on strong sales of "Star Wars" merchandise ahead of the May 2005 release of the movie "Star Wars: Episode III-Revenge of the Sith."
"The second quarter will be challenging," President and CEO Alfred Verrecchia said on a conference call. "We shipped $147 million of 'Star Wars' product in second quarter of '05. Even if our first-quarter trend of an approximate 50 percent fall-off continues, we will have to make up over $70 million in volume."
"Star Wars" products, which include lightsabers and action figures, accounted for 16 percent of Hasbro's revenue in 2005. But with no new movie release set for this year, sales of "Star Wars"-related items are expected to drop......
Revenue in its North American segment rose 7 percent to $310.3 million, boosted in part by sales of board games such as Candy Land and Scrabble. International segment revenue fell 5 percent to $145.5 million, hurt by a foreign exchange impact of about $10.4 million.
Hasbro said shipments of "Star Wars" products in the first quarter were $51 million, down from $101 million the prior year's first quarter.
Toymakers have been suffering from an industrywide slump as electronic gadgets including video games and digital music players pull away once-captive young consumers, and rising costs and cutthroat competition eat into margins.
Hasbro's results came a week after larger rival Mattel Inc. (NYSE:MAT - news) reported an operating loss in its first quarter and forecast a challenging 2006.
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