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Recently we reported a news story regarding allegations regarding factory conditions at a factory in China called Jet Fair that Hasbro used to produce many of their products including Transformers. Well Hasbro issued a press release on the 22nd of December regarding the factory, a copy of which you can view below.
Hasbro Inc. Statement Regarding NGO Allegations on Factory Conditions
Immediately following some unsubstantiated allegations posted by an outside group regarding working conditions at the Jet Fair factory, Hasbro, together with ICTI, deployed a team to investigate, as we take such claims very seriously. Following an unannounced, nine-hour inspection of the facility this past week, we are satisfied that Jet Fair meets with Hasbro's rigorous requirements.
While Hasbro is committed to continual improvement in all facets of corporate social responsibility, including continued ethical product manufacturing at Jet Fair and all factories that produce Hasbro products, the inflammatory allegations made by the NGO in their report were unsubstantiated by our investigation. As a matter of course, Hasbro will continue to monitor conditions at Jet Fair and all of our factories.
The Company has a strong track record and has had long-standing policies and processes in place for years to help ensure good working conditions, including health and safety, at factories making our products. We strive to conduct business throughout our supply chain in accordance with the highest ethical standards, and we utilize not only ICTI-- but also our own on-the-ground workforce-- to monitor social compliance.
For more information about Hasbro's comprehensive corporate social responsibility (CSR) activities, including more detail regarding Hasbro's policies and practices related to ethical product manufacturing, please visit Hasbro.com/csr.
You can vierw the original press release at http://csr.hasbro.com/new01-news.php.
Other investigations have been made into the author of the report which bring into question his track record. As well known and respected Transformers related researcher Nevermore points out the writer of the report was already found just last week to have written a similar report about another Chinese factory where he had made some unsubstantiated claims as well. http://marquee.blogs.cnn.com/2011/12/22/kardashian-family-sweatshop-claims-not-true/, http://www.tmz.com/2011/12/21/kim-kardashian-factory-china-slave-labor-tmz-live/#.Tvnnppd6hIG. Whilst there may still be truth to the original report, these latest twist do back up Hasbro's stance.
Our thanks go out to Nevermore for the update on the story.Â

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