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Hasbro Inc have now issued their Quarterly 10k report, a full copy can by viewed here.  In summary, revenue is up for Hasbro in the last quarter however 9 month revenue and profit is down on last year.

On the Transformers side, increased sale within the US and Canada were used to prop up declining sales in NERF and other lines with the same being true internationally.  Hasbro's increased licensing, when it came to entertainment, was driven by growth from licenses within the Transformers product.  Below you will find an extract covering the main breakdown.

U.S. AND CANADA SEGMENT

The U.S. and Canada segment's net revenues for the quarter ended September 25, 2011 decreased 7% to $764,562 from $825,483 for the quarter ended September 26, 2010. The decrease in the quarter was a result of decreased revenues in the boys, girls, and games and puzzles categories, partially offset by increased revenues in the preschool category. The increase in the preschool category primarily relates to sales related to the introduction of a number of product offerings under the Sesame Workshop license during the quarter. Increases in the preschool category were partially offset by decreased revenues from

HASBRO, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition and Results of Operations (continued)

(Thousands of Dollars and Shares Except Per Share Data)

PLAYSKOOL, TONKA, and PLAY-DOH product lines. The decrease in the boys category primarily relates to decreased sales of STAR WARS, MARVEL, and NERF products, partially offset by increased sales of BEYBLADE and TRANSFORMERS, including KRE-O products. The decrease in the girls category primarily relates to decreased sales of LITTLEST PET SHOP and FURREAL FRIENDS products, partially offset by increased sales of BABY ALIVE, EASY BAKE, and MY LITTLE PONY products. The decrease in the games and puzzles category primarily relates to lower sales of board games, partially offset by higher sales of MAGIC: THE GATHERING.

U.S. and Canada segment net revenues for the nine months ended September 25, 2011 were $1,660,664 compared to $1,694,713 for the nine months ended September 26, 2010. The decrease in the nine months ended September 25, 2011 was the result of decreased revenues in the girls and games and puzzles category, partially offset by increased revenues in the boys category. The increase in the boys category primarily relates to increased sales of BEYBLADE products, which were reintroduced in late 2010, as well as higher sales of TRANSFORMERS products as a result of the June 2011 movie release, TRANSFORMERS: DARK OF THE MOON. These increases were partially offset by decreased revenues from MARVEL, NERF and STAR WARS products. Decreases in the girls category were primarily driven by lower sales of LITTLEST PET SHOP products, partially offset by higher sales of MY LITTLE PONY and BABY ALIVE products while decreases in the games and puzzles category primarily relate to lower sales of board games partially offset by increased sales of MAGIC: THE GATHERING.

U.S. and Canada segment operating profit decreased to $128,789, or 16.8% of net revenues, for the quarter ended September 25, 2011 compared to $158,763, or 19.2% of net revenues, for the quarter ended September 26, 2010. For the nine months ended September 25, 2011 operating profit decreased to $227,526, or 13.7% of net revenues, from $278,635, or 16.4% of net revenues, for the nine months ended September 26, 2010. For the quarter and nine months ended September 25, 2011 operating profit was negatively impacted by a the decline in net revenues as well as higher royalty and selling, distribution and administration costs. Operating profit margin for the quarter and nine months ended September 25, 2011 was negatively impacted by a decline in net revenues and higher selling, distribution and administration costs. In addition, the operating profit margin for the nine month period of 2011 was impacted by a higher mix of shipments of closeouts during the first half of the year, which represents carryover inventory from year end 2010. Although this inventory was written down last year, the subsequent sales have minimal to no profit.

INTERNATIONAL SEGMENT

International segment net revenues increased by 23% to $563,310 for the quarter ended September 25, 2011 from $458,917 for the quarter ended September 26, 2010. Net revenues for the nine months ended September 25, 2011 increased 27% to $1,192,113 from $942,047 for the nine months ended September 26, 2010. For the quarter ended September 25, 2011, International segment net revenues were positively impacted by currency translation of approximately $35,200, or 8%, as a result of the weaker U.S. dollar during the quarter. For the nine months ended September 25, 2011, International segment net revenues were positively impacted by currency translation of approximately $72,500, or 8%, as a result of the weaker U.S. dollar in the first nine months of 2011. Increased net

HASBRO, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition and Results of Operations (continued)

(Thousands of Dollars and Shares Except Per Share Data)

revenues in the quarter and nine months ended September 25, 2011 were driven by higher sales in the boys category primarily as a result of higher sales of BEYBLADE, NERF, and TRANSFORMERS products, partially offset by decreased sales of MARVEL and STAR WARS products. Revenues in the girls, games and puzzles and preschool categories decreased slightly. The decrease in the girls category was driven by decreased sales of LITTLEST PET SHOP products partially offset by increased sales of FURREAL FRIENDS and BABY ALIVE products. Decreases in the preschool category are primarily the result of lower sales of PLAYSKOOL products partially offset by sales related to the introduction of a number of product offerings under the Sesame Workshop license as well as higher sales of PLAY-DOH products. Decreases in the games and puzzles category were driven by decreased sales of board games, offset by higher revenues from MAGIC: THE GATHERING products in the quarter. International segment net revenues for the quarter and nine months ended September 25, 2011 increased in all regions, which includes Europe, Asia-Pacific and Latin and South America.

International segment operating profit increased to $100,739, or 17.9% of net revenues, for the quarter ended September 25, 2011 from $70,818, or 15.4% of net revenues, for the quarter ended September 26, 2010. For the nine months ended September 25, 2011, operating profit increased to $132,756, or 11.1% of net revenues, from $79,984, or 8.5% of net revenues, for the nine months ended September 26, 2010. International segment operating profit was positively impacted by currency translation of approximately $4,300 and $6,500 for the quarter and nine months ended September 25, 2011, respectively. The increase in operating profit was primarily a result of the impact of increased revenues partially offset by higher royalty expenses as well as higher expenses as the result of the Company's investments in expanding its operations in emerging markets. Operating profit margin for the quarter and nine months ended September 25, 2011 was positively impacted by higher net revenues.

ENTERTAINMENT AND LICENSING SEGMENT

Entertainment and Licensing segment net revenues for the quarter ended September 25, 2011 increased 69% to $46,316 from $27,478 for the quarter ended September 26, 2010. Net revenues for the nine months ended September 25, 2011 was $98,144 compared to $83,038 for the nine months ended September 26, 2010. Licensing revenue related to entertainment brands tends to lag traditional toy and game revenue due to when licensing partners report their revenue to the Company. As a result, there was increased licensing revenue in the third quarter of 2011 related to the June 2011 movie release of TRANSFORMERS: DARK OF THE MOON. In addition to movie-related licensing revenue, licensing revenue related to movies and television programming increased as well. Included in revenues for the quarter and nine months ended September 25, 2011 is a one-time movie-related payment of $5,000 received from Universal Studios.

Entertainment and Licensing segment operating profit increased to $15,251 for the quarter ended September 25, 2011 compared to $5,918 for the quarter ended September 26, 2010. The increase was primarily due to the higher movie-related licensing revenues, which offset higher selling, distribution and administration expense in 2011 compared to 2010. For the nine months ended September 25, 2011 operating profit decreased to $21,294 from $28,280 for the nine months ended

Category: Toy Industry News | Submitted by: quartz - on: Thursday, 3rd November 2011 at 09:03:57 GMT | Share: | Discuss: Read on

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