Company Reports Growth in Profit and EPS in the
Quarter and Raises Full Year Guidance Declares Quarterly
Dividend
Hasbro, Inc. (NASDAQ: HAS), a leading toy and game company,
today reported financial results for the second quarter 2024.
"We delivered a solid performance in games and digital licensing
and substantial margin improvement this quarter,” said Chris Cocks,
Hasbro Chief Executive Officer. “Hasbro is emerging as a more
profitable, agile, and operationally excellent company delighting
fans of all ages through the magic of play."
"We continued to make meaningful progress in our turnaround for
Consumer Products in the second quarter," said Gina Goetter, Hasbro
Chief Financial Officer. “The Hasbro team remains focused on back
half execution and delivering on our updated full year
commitments.”
Second Quarter 2024 Highlights
- Second quarter Hasbro, Inc. revenue declined 18% driven
primarily by the eOne divestiture; excluding the divestiture,
revenue declined 6%. Growth of 20% in the Wizards of the Coast and
Digital Gaming segment was offset by declines in Consumer Products
(-20%) and Entertainment (-90%, or -30%, excluding the eOne
divestiture).
- Operating profit of $212 million and operating margin of 21.3%
includes $37 million of intangible amortization associated with
eOne, loss on disposal of business and costs associated with the
Company's transformation.
- Adjusted operating profit of $249 million (+$112 million vs.
PY) and adjusted operating margin of 25.0% (+13.7 points vs. PY),
driven by favorable business mix, supply chain productivity and
reduced operating costs.
- Delivered $40 million of net cost savings and approximately $90
million year to date; on track for full-year net savings
commitment.
- Hasbro owned inventory down 51% versus prior year, including a
55% decline in Consumer Products inventory versus the second
quarter 2023.
- Reported net earnings of $0.99 per diluted share; adjusted net
earnings of $1.22 per diluted share benefiting from favorable
business mix and improved operations.
- Company raises full year guidance.
- Paid $97 million in cash dividends to shareholders in the
quarter.
Second Quarter 2024 Segment Details
- Consumer Products Segment
- Revenue decrease of 20% driven by shifts in entertainment
timing, planned business exits and reduced closeouts; growth in
Consumer Products Licensing (+11%) in the quarter.
- Operating margin of -1.8% and adjusted operating margin of
-0.1% behind supply chain cost productivity and reduced operating
expenses partially offsetting the volume deleverage.
- FURBY, PLAY-DOH and G.I. JOE performed well in the quarter;
momentum building for 2H innovation in Beyblade and TRANSFORMERS
entertainment.
- Wizards of the Coast and Digital Gaming Segment
- Revenue increase of 20% driven by the launch of MAGIC'S Modern
Horizons 3 set and continued strength in Licensed and Digital
Gaming revenue behind Monopoly Go!, Baldur's Gate 3 and a benefit
from an international publishing deal.
- Tabletop revenue increased 3% behind growth in MAGIC: THE
GATHERING.
- Operating profit increased 74% and operating profit margin of
54.7% due to higher digital licensing revenue mix of revenues and
lower royalty expense.
- Entertainment Segment
- Revenue decline of 90% impacted by the sale of eOne Film and TV
in December 2023; absent this impact, revenue declined 30% driven
by the timing of the delivery of deals.
- Operating loss of $1 million compared to operating loss of $324
million in the second quarter 2023.
- Adjusted operating profit of $18 million compared to adjusted
operating loss of $21 million in the second quarter 2023.
Year to Date 2024 Highlights
- Year to date Hasbro revenue declined 21% driven primarily by
the eOne film and television divestiture; excluding the
divestiture, revenue declined 7%. Growth of 15% in the Wizards of
the Coast and Digital Gaming segment was offset by declines in
Consumer Products (-20%) and Entertainment (-87%, or +2% excluding
the eOne divestiture).
- Operating profit of $328 million and operating margin of 18.7%
includes $69 million of intangible amortization associated with
eOne, loss on disposal of business and costs associated with the
Company's transformation.
- Adjusted operating profit of $397 million (+$213 million vs.
PY) and adjusted operating margin of 22.7% (+14.4 points vs. PY),
driven by favorable business mix, lower royalty expense, supply
chain productivity and reduced operating costs.
- Reported net earnings of $1.41 per diluted share; adjusted net
earnings of $1.83 per diluted share benefiting from improved
operations, favorability from a stock compensation adjustment taken
in Q1 and net interest expense reduction.
- Operating cash flow of $365 million vs. $119 million in the
prior year driven by improved operating results and favorable
timing.
Year to Date 2024 Segment Details
- Consumer Products Segment
- Revenue decrease of 20% driven by business exits, reduced
closeouts and entertainment timing.
- Operating margin of -6.0% and adjusted operating margin of
-4.1%; cost savings and productivity gains more than offset by
volume declines.
- Wizards of the Coast and Digital Gaming Segment
- Revenue increase of 15% driven by growth in MAGIC: THE
GATHERING and strength in Licensed and Digital Gaming.
- Tabletop revenue increased 4% behind growth in MAGIC: THE
GATHERING.
- Operating profit increased 69% and operating profit margin of
48.1% due to higher digital licensing revenue mix of revenues and
lower royalty expense.
- Entertainment Segment
- Revenue decline of 87% impacted by the sale of eOne Film and
TV; absent this impact, revenue increased $1 million driven by the
timing of the delivery of deals.
- Operating profit of $5 million compared to operating loss of
$333 million year to date 2023.
- Adjusted operating profit of $36 million compared to adjusted
operating loss of $23 million year to date 2023.
See the financial tables accompanying the press release for a
reconciliation of GAAP to non-GAAP financial measures.
2024 Company Outlook1
For the full year, the Company now expects:
- Consumer Products Segment revenue down 7% to 11%; Adjusted
operating margin 4% to 6%.
- Wizards of the Coast Segment revenue down 1% to 3%; Operating
margin of approximately 42%.
- Pro-Forma Entertainment segment revenue down $15 million;
Adjusted operating margin of approximately 60%.
- Total Hasbro Adjusted EBITDA of $975 million to $1.025
billion.
- Gross savings target of $750 million by year end 2025.
2024 Capital Allocation priorities:
- Invest in core business.
- Return cash to shareholders through the dividend.
- Continue to pay down debt and progress towards leverage
target.
1The Company is not able to reconcile its forward-looking
non-GAAP adjusted operating margin and adjusted EBITDA measures
because the Company cannot predict with certainty the timing and
amounts of discrete items such as charges associated with its
cost-savings program, which could impact GAAP results.
Dividend Announcement During
the second quarter, the Company paid $97 million in cash dividends
to shareholders. The Board of Directors has declared a quarterly
cash dividend of $0.70 per common share payable on September 4,
2024, to shareholders of record at the close of business on August
21, 2024.
Conference Call Webcast
Hasbro will webcast its second quarter 2024 earnings conference
call at 8:30 a.m. Eastern Time today. To listen to the live webcast
and access the accompanying presentation slides, please go to
https://investor.hasbro.com. The replay of the call will be
available on Hasbro’s website approximately 2 hours following
completion of the call.
About Hasbro Hasbro is a leading toy and game company
whose mission is to entertain and connect generations of fans
through the wonder of storytelling and the exhilaration of play.
Hasbro delivers play experiences for fans of all ages around the
world through toys, games, licensed consumer products, digital
games and services, location-based entertainment, film, TV, and
more. With a portfolio of over 1,800 iconic brands including MAGIC:
THE GATHERING, DUNGEONS & DRAGONS, Hasbro Gaming, NERF,
TRANSFORMERS, PLAY-DOH and PEPPA PIG, as well as premier partner
brands, Hasbro brings fans together wherever they are, from
tabletop to screen.
Hasbro is guided by our Purpose to create joy and community for
all people around the world, one game, one toy, one story at a
time. For more than a decade, Hasbro has been consistently
recognized for its corporate citizenship, including being named one
of the 100 Best Corporate Citizens by 3BL Media, one of the World’s
Most Ethical Companies by Ethisphere Institute, and one of the 50
Most Community-Minded Companies in the U.S. by the Civic 50. For
more information, visit https://corporate.hasbro.com or @Hasbro on
LinkedIn.
© 2024 Hasbro, Inc. All Rights Reserved.
Forward Looking Statement Safe Harbor Certain statements
in this press release contain “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of
1995. These statements, which may be identified by the use of
forward-looking words or phrases, include statements relating to
our business strategies and plans; expectations relating to
products, gaming and entertainment; anticipated cost savings; and
financial targets and guidance. Our 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. Factors that might cause such a difference include,
but are not limited to:
- our ability to successfully execute on our business strategy
and transformation initiatives;
- our ability to successfully compete in the play industry and
further develop our digital gaming and licensing business;
- our ability to transform our business and capabilities to
address the changing global consumer landscape;
- our ability to design, develop, manufacture, and ship products
on a timely, cost-effective and profitable basis;
- the concentration of our customers, potentially increasing the
negative impact to our business of difficulties experienced by any
of our customers or changes in their purchasing or selling
patterns;
- uncertain and unpredictable global and regional economic
conditions impacting one or more of the markets in which we sell
products, which can negatively impact our customers and consumers,
result in lower employment levels, consumer disposable income,
retailer inventories and spending, including lower spending on
purchases of our products;
- risks related to political, economic and public health
conditions or regulatory changes in the markets in which we and our
customers, partners, licensees, suppliers and manufacturers
operate, such as inflation, rising interest rates, tariffs, higher
commodity prices, labor costs or transportation costs, or outbreaks
of illness or disease, the occurrence of which could create work
slowdowns, delays or shortages in production or shipment of
products, increases in costs or delays in revenue;
- our dependence on third party relationships, including with
third party partners, manufacturers, distributors, studios, content
producers, licensors, licensees, and outsourcers, which creates
reliance on others and loss of control;
- risks relating to the concentration of manufacturing for many
of our products in the People’s Republic of China and our ability
to successfully diversify sourcing of our products to reduce
reliance on sources of supply in China;
- risks associated with international operations, such as
conflict in territories in which we operate, currency conversion,
currency fluctuations, the imposition or threat of tariffs, quotas,
shipping delays or difficulties, border adjustment taxes or other
protectionist measures, and other challenges in the territories in
which we operate;
- the success of our key partner brands, including the ability to
secure, maintain and extend agreements with our key partners or the
risk of delays, increased costs or difficulties associated with any
of our or our partners’ planned digital applications or media
initiatives;
- risks related to our leadership changes;
- our ability to attract and retain talented and diverse
employees, particularly following recent workforce reductions;
- our ability to realize the benefits of cost-savings and
efficiency and/or revenue and operating profit enhancing
initiatives;
- risks relating to the impairment and/or write-offs of
businesses, products and content we acquire and/or produce;
- the risk that acquisitions, dispositions and other investments
we complete may not provide us with the benefits we expect, or the
realization of such benefits may be significantly delayed;
- our ability to protect our assets and intellectual property,
including as a result of infringement, theft, misappropriation,
cyber-attacks or other acts compromising the integrity of our
assets or intellectual property;
- fluctuations in our business due to seasonality;
- the risk of product recalls or product liability suits and
costs associated with product safety regulations;
- changes in accounting treatment, tax laws or regulations, or
the interpretation and application of such laws and regulations,
which may cause us to alter reserves or make other changes which
significantly impact our reported financial results;
- the impact of litigation or arbitration decisions or settlement
actions;
- the bankruptcy or other lack of success of one or more of our
significant retailers, licensees and other partners; and
- other risks and uncertainties as may be detailed in our public
announcements and U.S. Securities and Exchange Commission (“SEC”)
filings.
The statements contained herein are based on our current beliefs
and expectations. We undertake no obligation to make any revisions
to the forward-looking statements contained in this press release
or to update them to reflect events or circumstances occurring
after the date of this press release.
Non-GAAP Financial Measures The financial tables
accompanying this press release include non-GAAP financial measures
as defined under SEC rules, specifically Adjusted operating profit,
Adjusted operating margin, Adjusted net earnings and Adjusted net
earnings per diluted share, which exclude, where applicable,
acquisition-related costs, acquired intangible amortization,
Operational Excellence and Blueprint 2.0 implementation charges;
and certain non-cash asset impairment charges. Also included in
this press release are the non-GAAP financial measures of EBITDA
and Adjusted EBITDA. EBITDA represents net earnings attributable to
Hasbro, Inc. excluding interest expense, income tax expense, net
earnings attributable to noncontrolling interests, depreciation and
amortization of intangibles. Adjusted EBITDA also excludes
Operational Excellence and Blueprint 2.0 implementation charges,
certain non-cash asset impairment charges and the impact of stock
compensation (including acquisition-related stock expense). As
required by SEC rules, we have provided reconciliations on the
attached schedules of these measures to the most directly
comparable GAAP measure. Management believes that Adjusted net
earnings, Adjusted net earnings per diluted share, Adjusted
operating profit and Adjusted operating margin provide investors
with an understanding of the underlying performance of our business
absent unusual events. Management believes that EBITDA and Adjusted
EBITDA are appropriate measures for evaluating the operating
performance of our business because they reflect the resources
available for strategic opportunities including, among others, to
invest in the business, strengthen the balance sheet and make
strategic acquisitions. These non-GAAP measures should be
considered in addition to, not as a substitute for, or superior to,
net earnings or other measures of financial performance prepared in
accordance with GAAP as more fully discussed in our consolidated
financial statements and filings with the SEC. As used herein,
"GAAP" refers to accounting principles generally accepted in the
United States of America.
HAS-E
(Tables Attached)
HASBRO, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(1)
(Unaudited)
(Millions of Dollars)
June 30, 2024
July 2, 2023
ASSETS
Cash and Cash Equivalents
$
626.8
$
216.6
Short-term Investments
483.0
—
Accounts Receivable, Net
789.0
877.0
Inventories
357.6
731.3
Prepaid Expenses and Other Current
Assets
418.0
684.1
Total Current Assets
2,674.4
2,509.0
Property, Plant and Equipment, Net
542.9
515.4
Goodwill
2,278.8
3,239.2
Other Intangible Assets, Net
552.8
724.8
Other Assets
815.2
1,621.3
Total Assets
$
6,864.1
$
8,609.7
LIABILITIES, NONCONTROLLING INTERESTS
AND SHAREHOLDERS' EQUITY
Short-Term Borrowings
$
—
$
148.2
Current Portion of Long-Term Debt
500.0
69.4
Accounts Payable
297.5
363.4
Accrued Liabilities
1,032.6
1,369.4
Total Current Liabilities
1,830.1
1,950.4
Long-Term Debt
3,461.4
3,668.5
Other Liabilities
399.7
520.6
Total Liabilities
5,691.2
6,139.5
Total Shareholders' Equity
1,172.9
2,470.2
Total Liabilities, Noncontrolling
Interests and Shareholders' Equity
$
6,864.1
$
8,609.7
(1) Amounts may not sum due to
rounding
HASBRO, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(1)
(Unaudited)
(Millions of Dollars and Shares Except Per
Share Data)
Three Months Ended
Six Months Ended
June 30, 2024
July 2, 2023
June 30, 2024
July 2, 2023
Amount
% of Net Revenues
Amount
% of Net Revenues
Amount
% of Net Revenues
Amount
% of Net Revenues
Net revenues
$
995.3
100.0
%
$
1,210.0
100.0
%
$
1,752.6
100.0
%
$
2,211.0
100.0
%
Costs and expenses:
Cost of sales
237.7
23.9
%
352.2
29.1
%
441.9
25.2
%
637.5
28.8
%
Program production cost amortization
8.5
0.9
%
134.4
11.1
%
16.6
0.9
%
256.9
11.6
%
Royalties
55.3
5.6
%
119.9
9.9
%
106.2
6.1
%
188.9
8.5
%
Product development
70.4
7.1
%
72.4
6.0
%
135.9
7.8
%
155.7
7.0
%
Advertising
60.4
6.1
%
85.1
7.0
%
111.9
6.4
%
167.9
7.6
%
Amortization of intangibles
17.1
1.7
%
22.8
1.9
%
34.1
1.9
%
45.9
2.1
%
Impairment of goodwill
—
—
%
231.2
19.1
%
—
—
%
231.2
10.5
%
Loss on disposal of business
15.3
1.5
%
—
—
%
24.4
1.4
%
—
—
%
Selling, distribution and
administration
318.5
32.0
%
380.6
31.5
%
553.3
31.6
%
697.7
31.6
%
Total costs and expenses
783.2
78.7
%
1,398.6
115.6
%
1,424.3
81.3
%
2,381.7
107.7
%
Operating profit (loss)
212.1
21.3
%
(188.6
)
(15.6
)%
328.3
18.7
%
(170.7
)
(7.7
)%
Non-operating (income) expense:
—
%
Interest expense
43.0
4.3
%
46.6
3.9
%
81.5
4.7
%
92.9
4.2
%
Interest income
(13.0
)
(1.3
)%
(5.8
)
(0.5
)%
(21.3
)
(1.2
)%
(11.8
)
(0.5
)%
Other (income) expense, net
(0.8
)
(0.1
)%
(1.5
)
(0.1
)%
4.2
0.2
%
(2.9
)
(0.1
)%
Total non-operating expense, net
29.2
2.9
%
39.3
3.2
%
64.4
3.7
%
78.2
3.5
%
Earnings (loss) before income taxes
182.9
18.4
%
(227.9
)
(18.8
)%
263.9
15.1
%
(248.9
)
(11.3
)%
Income tax expense
44.4
4.5
%
7.0
0.6
%
66.3
3.8
%
7.7
0.3
%
Net earnings (loss)
138.5
13.9
%
(234.9
)
(19.4
)%
197.6
11.3
%
(256.6
)
(11.6
)%
Net earnings attributable to
noncontrolling interests
—
—
%
0.1
—
%
0.9
0.1
%
0.5
—
%
Net earnings (loss) attributable to
Hasbro, Inc.
$
138.5
13.9
%
$
(235.0
)
(19.4
)%
$
196.7
11.2
%
$
(257.1
)
(11.6
)%
Net earnings (loss) per common share:
Basic
$
0.99
$
(1.69
)
$
1.41
$
(1.85
)
Diluted
$
0.99
$
(1.69
)
$
1.41
$
(1.85
)
Cash Dividends Declared
$
—
$
0.70
$
0.70
$
1.40
Weighted Average Number of Shares
Basic
139.5
138.8
139.2
138.7
Diluted
140.0
138.8
139.6
138.7
(1) Amounts may not sum due to
rounding
HASBRO, INC.
CONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS (1)
(Unaudited)
(Millions of Dollars)
Six months ended
June 30, 2024
July 2, 2023
Cash Flows from Operating Activities:
Net Earnings (Loss)
$
197.6
$
(256.6
)
Loss on Disposal of Business
24.4
—
Impairment of Goodwill and Intangible
Assets
—
231.2
Other Non-Cash Adjustments
133.9
432.1
Changes in Operating Assets and
Liabilities
9.2
(287.5
)
Net Cash Provided by Operating
Activities
365.1
119.2
Cash Flows from Investing Activities:
Additions to Property, Plant and
Equipment
(97.7
)
(112.1
)
Purchase of investments
(480.1
)
—
Other
2.4
(3.7
)
Net Cash Utilized by Investing
Activities
(575.4
)
(115.8
)
Cash Flows from Financing Activities:
Proceeds from Long-Term Debt
500.0
1.6
Repayments of Long-Term Debt
—
(90.7
)
Net Repayments of Short-Term
Borrowings
—
6.6
Dividends Paid
(194.6
)
(193.8
)
Payments Related to Tax Withholding for
Share-Based Compensation
(11.9
)
(14.5
)
Stock-Based Compensation Transactions
4.0
—
Payments of Financing Costs
(6.7
)
—
Other
(2.3
)
(5.4
)
Net Cash Provided (Utilized) by Financing
Activities
288.5
(296.2
)
Effect of Exchange Rate Changes on
Cash
3.2
(3.7
)
Net Increase (Decrease) in Cash and Cash
Equivalents
81.4
(296.5
)
Cash and Cash Equivalents at Beginning of
Year
545.4
513.1
Cash and Cash Equivalents at End of
Period
$
626.8
$
216.6
(1) Amounts may not sum due to
rounding
HASBRO, INC.
SEGMENT RESULTS - AS REPORTED AND AS
ADJUSTED (1)
(Unaudited)
(Millions of Dollars)
Three Months Ended June 30,
2024
Three Months Ended July 2,
2023
Operating
Results
As Reported
Non-GAAP Adjustments
Adjusted
As Reported
Non-GAAP Adjustments
Adjusted
% Change
Total Company
Results
External Net Revenues
$
995.3
$
—
$
995.3
$
1,210.0
$
—
$
1,210.0
-18
%
Operating Profit (Loss)
212.1
36.7
248.8
(188.6
)
325.4
136.8
82
%
Operating Margin
21.3
%
3.7
%
25.0
%
-15.6
%
26.9
%
11.3
%
Segment
Results
Consumer
Products:
External Net Revenues
$
524.5
$
—
$
524.5
$
655.2
$
—
$
655.2
-20
%
Operating Profit (Loss)
(9.3
)
9.0
(0.3
)
11.4
10.8
22.2
>-100
%
Operating Margin
-1.8
%
1.7
%
-0.1
%
1.7
%
1.6
%
3.4
%
Wizards of the Coast
and Digital Gaming:
External Net Revenues
$
452.0
$
—
$
452.0
$
375.6
$
—
$
375.6
20
%
Operating Profit
247.1
—
247.1
142.3
—
142.3
74
%
Operating Margin
54.7
%
—
54.7
%
37.9
%
—
37.9
%
Entertainment:
External Net Revenues
$
18.8
$
—
$
18.8
$
179.2
$
—
$
179.2
-90
%
Operating Profit (Loss)
(1.0
)
18.7
17.7
(324.2
)
303.4
(20.8
)
>100
%
Operating Margin
-5.3
%
99.5
%
94.1
%
>-100
%
>100
%
-11.6
%
Corporate and
Other:
Operating Profit (Loss)
$
(24.7
)
$
9.0
$
(15.7
)
$
(18.1
)
$
11.2
$
(6.9
)
>-100
%
(1) Amounts within this section may not
sum due to rounding
Three Months Ended
Net Revenues by
Brand Portfolio
June 30, 2024
July 2, 2023
% Change
Franchise Brands (1)
$
786.6
$
788.4
0
%
Partner Brands
124.6
172.9
-28
%
Portfolio Brands (2)
84.1
107.9
-22
%
Non-Hasbro Branded Film & TV (2)
—
140.8
-100
%
Total
$
995.3
$
1,210.0
(1) Franchise Brands include: DUNGEONS
& DRAGONS, Hasbro Gaming, MAGIC: THE GATHERING, NERF, PEPPA
PIG, PLAY-DOH and TRANSFORMERS.
(2) Effective in the first quarter of
2024, the Company moved the remaining Non-Hasbro Branded Film &
TV brands into Portfolio Brands to align with the Company's Brand
Strategy. For comparability net revenues for the three months ended
June 30, 2024, has been restated to reflect the movement, resulting
in a change of $0.8.
Three Months Ended
June 30, 2024
July 2, 2023
% Change
MAGIC: THE GATHERING
$
336.0
$
311.0
8
%
Hasbro Total Gaming (1)
548.4
491.2
12
%
(1) Hasbro Total Gaming includes all
gaming revenue, most notably DUNGEONS & DRAGONS, MAGIC: THE
GATHERING and Hasbro Gaming.
Three Months Ended
Consumer Products
Segment Net Revenues by Major Geographic Region
June 30, 2024
July 2, 2023
% Change
North America
$
306.1
$
382.0
-20
%
Europe
92.0
131.9
-30
%
Asia Pacific
62.6
66.4
-6
%
Latin America
63.8
74.9
-15
%
Net revenues
$
524.5
$
655.2
Three Months Ended
Wizards of the
Coast and Digital Gaming Net Revenues by Category
June 30, 2024
July 2, 2023
% Change
Tabletop Gaming
$
307.6
$
298.5
3
%
Digital and Licensed Gaming
144.4
77.1
87
%
Net revenues
$
452.0
$
375.6
Three Months Ended
Entertainment
Segment Net Revenues by Category
June 30, 2024
July 2, 2023
% Change
Film and TV
$
1.8
$
153.3
-99
%
Family Brands
17.0
25.9
-34
%
Net revenues
$
18.8
$
179.2
Six Months Ended June 30,
2024
Six Months Ended July 2,
2023
Operating
Results (1)
As Reported
Non-GAAP Adjustments
Adjusted
As Reported
Non-GAAP Adjustments
Adjusted
% Change
Total Company
Results
External Net Revenues
$
1,752.6
$
—
$
1,752.6
$
2,211.0
$
—
$
2,211.0
-21
%
Operating Profit (Loss)
328.3
69.1
397.4
(170.7
)
354.7
184.0
>100
%
Operating Margin
18.7
%
3.9
%
22.7
%
-7.7
%
16.0
%
8.3
%
Segment
Results
Consumer
Products:
External Net Revenues
$
937.5
$
—
$
937.5
$
1,175.6
$
—
$
1,175.6
-20
%
Operating Profit (Loss)
(56.2
)
18.1
(38.1
)
(34.6
)
21.4
(13.2
)
>-100
%
Operating Margin
-6.0
%
1.9
%
-4.1
%
-2.9
%
1.8
%
-1.1
%
Wizards of the Coast
and Digital Gaming:
External Net Revenues
$
768.3
$
—
$
768.3
$
670.8
$
—
$
670.8
15
%
Operating Profit
369.9
—
369.9
219.1
—
219.1
69
%
Operating Margin
48.1
%
—
48.1
%
32.7
%
—
32.7
%
Entertainment:
External Net Revenues
$
46.8
$
—
$
46.8
$
364.6
$
—
$
364.6
-87
%
Operating Profit (Loss)
4.8
31.1
35.9
(332.9
)
309.6
(23.3
)
>100
%
Operating Margin
10.3
%
66.5
%
76.7
%
-91.3
%
84.9
%
-6.4
%
Corporate and
Other:
Operating Profit (Loss)
$
9.8
$
19.9
$
29.7
$
(22.3
)
$
23.7
$
1.4
>100
%
(1) Amounts within this section may not
sum due to rounding
Six Months Ended
Net Revenues by
Brand Portfolio
June 30, 2024
July 2, 2023
% Change
Franchise Brands (1)
$
1,393.1
$
1,401.8
-1
%
Partner Brands
212.3
305.6
-31
%
Portfolio Brands (2)
147.2
200.0
-26
%
Non-Hasbro Branded Film & TV (2)
—
303.6
-100
%
Total
$
1,752.6
$
2,211.0
(1) Franchise Brands include: DUNGEONS
& DRAGONS, Hasbro Gaming, MAGIC: THE GATHERING, NERF, PEPPA
PIG, PLAY-DOH and TRANSFORMERS.
(2) Effective in the first quarter of
2024, the Company moved the remaining Non-Hasbro Branded Film &
TV brands into Portfolio Brands to align with the Company's Brand
Strategy. For comparability net revenues for the six months ended
June 30, 2024, has been restated to reflect the movement, resulting
in a change of $0.9.
Six Months Ended
June 30, 2024
July 2, 2023
% Change
MAGIC: THE GATHERING
$
573.9
$
540.1
6
%
Hasbro Total Gaming (1)
956.4
877.7
9
%
(1) Hasbro Total Gaming includes all
gaming revenue, most notably DUNGEONS & DRAGONS, MAGIC: THE
GATHERING and Hasbro Gaming.
Six Months Ended
Consumer Products
Segment Net Revenues by Major Geographic Region
June 30, 2024
July 2, 2023
% Change
North America
$
545.2
$
661.1
-18
%
Europe
179.5
263.5
-32
%
Asia Pacific
111.4
129.7
-14
%
Latin America
101.4
121.3
-16
%
Net revenues
$
937.5
$
1,175.6
Six Months Ended
Wizards of the
Coast and Digital Gaming Net Revenues by Category
June 30, 2024
July 2, 2023
% Change
Tabletop Gaming
$
535.8
$
516.4
4
%
Digital and Licensed Gaming
232.5
154.4
51
%
Net revenues
$
768.3
$
670.8
Six Months Ended
Entertainment
Segment Net Revenues by Category
June 30, 2024
July 2, 2023
% Change
Film and TV
$
1.8
$
321.7
-99
%
Family Brands
45.0
42.9
5
%
Net revenues
$
46.8
$
364.6
HASBRO, INC.
NON-GAAP RECONCILIATION
(Unaudited)
(Millions of Dollars)
Three Months Ended
Six Months Ended
Reconciliation of
EBITDA and Adjusted EBITDA (1)
June 30, 2024
July 2, 2023
June 30, 2024
July 2, 2023
Net Earnings (Loss) Attributable to
Hasbro, Inc.
$
138.5
$
(235.0
)
$
196.7
$
(257.1
)
Interest expense
43.0
46.6
81.5
92.9
Income tax expense
44.4
7.0
66.3
7.7
Net earnings attributable to
noncontrolling interests
—
0.1
0.9
0.5
Depreciation expense
28.4
30.6
49.6
54.6
Amortization of intangibles
17.1
22.8
34.1
45.9
EBITDA
$
271.4
$
(127.9
)
$
429.1
$
(55.5
)
Stock compensation
17.8
19.2
12.8
34.9
Operational Excellence charges
9.0
10.4
19.9
21.0
Blueprint 2.0 implementation charges
15.3
0.7
24.4
0.7
Impairment of goodwill and intangible
assets
—
296.2
—
296.2
Adjusted EBITDA
$
313.5
$
198.6
$
486.2
$
297.3
(1) Amounts may not sum due to
rounding
HASBRO, INC.
NON-GAAP RECONCILIATION
(Unaudited)
(Millions of Dollars)
Three Months Ended
Six Months Ended
Reconciliation of
Adjusted Operating Profit (1)
June 30, 2024
July 2, 2023
June 30, 2024
July 2, 2023
Operating Profit (Loss)
$
212.1
$
(188.6
)
$
328.3
$
(170.7
)
Consumer Products
(9.3
)
11.4
(56.2
)
(34.6
)
Wizards of the Coast and Digital
Gaming
247.1
142.3
369.9
219.1
Entertainment
(1.0
)
(324.2
)
4.8
(332.9
)
Corporate and Other
(24.7
)
(18.1
)
9.8
(22.3
)
Non-GAAP Adjustments
$
36.7
$
325.4
$
69.1
$
354.7
Consumer Products
9.0
10.8
18.1
21.4
Entertainment
18.7
303.4
31.1
309.6
Corporate and Other
9.0
11.2
19.9
23.7
Adjusted Operating Profit
$
248.8
$
136.8
$
397.4
$
184.0
Consumer Products
(0.3
)
22.2
(38.1
)
(13.2
)
Wizards of the Coast and Digital
Gaming
247.1
142.3
369.9
219.1
Entertainment
17.7
(20.8
)
35.9
(23.3
)
Corporate and Other
(15.7
)
(6.9
)
29.7
1.4
Non-GAAP Adjustments include the
following:
Acquisition-related costs (2)
$
—
$
—
$
—
$
1.9
Acquired intangible amortization (3)
12.4
18.1
24.8
34.9
Operational Excellence charges (4)
Transformation office and consultant fees
(a)
7.3
10.4
12.5
21.0
Severance and other employee charges
(b)
1.7
—
7.4
—
Blueprint 2.0 implementation charges
(5)
Loss on disposal of business (a)
15.3
—
24.4
—
eOne TV and Film business sale process
charges (b)
—
0.7
—
0.7
Impairment of goodwill and intangible
assets (6)
—
296.2
—
296.2
Total
$
36.7
$
325.4
$
69.1
$
354.7
(1) Amounts may not sum due to
rounding
(2) In association with the Company's
acquisition of eOne, the Company incurred stock compensation
expenses of $1.9 ($1.7 after-tax) in the six months ended July 2,
2023. The expense is included within Selling, Distribution and
Administration.
(3) Represents intangible amortization
costs related to the intangible assets acquired in the eOne
acquisition. The Company has allocated certain of these intangible
amortization costs between the Consumer Products and Entertainment
segments, to match the revenue generated from such intangible
assets. While amortization of acquired intangibles is being
excluded from the related GAAP financial measure, the revenue of
the acquired company is reflected within the Company's operating
results to which these assets contribute.
(4) These costs relate to the
comprehensive review of the Company's operations and development of
a transformation plan to support the organization in identifying,
realizing and capturing savings to create efficiencies and improve
business processes and operations. These charges consist of:
(a) Program related consultant and
transformation office fees of $7.3 ($5.6 after tax) and $12.5 ($9.6
after tax) for the three and six months ended June 30, 2024,
respectively, and $10.4 ($8.0 after-tax) and $21.0 ($16.1 after
tax) for the three and six months ended July 2, 2023, respectively,
are included within Selling, Distribution and Administration within
the Corporate and Other segment.
(b) Severance and other employee charges
of $1.7 ($1.3 after-tax) and $7.4 ($5.7 after-tax) for the three
and six months ended June 30, 2024, associated with cost-savings
initiatives across the Company.
(5) The Company announced the results of
its strategic review, Blueprint 2.0, a consumer-centric approach
focusing on fewer, bigger brands, expanded licensing, branded
entertainment, and high-margin growth in games, digital and direct.
As the Company implements the new strategy, charges recognized
consist of:
(a) Loss on disposal of a business of
$15.3 ($15.3 after-tax) and $24.4 ($24.4 after-tax) for the three
and six months ended June 30, 2024 related to the sale of the eOne
Film and TV business not directly supporting the Company's
Entertainment Strategy within the Entertainment segment, which was
executed on December 27, 2023. The year to date charge is included
within Loss on Disposal of Business.
(b) eOne TV and Film business sale process
charges of $0.7 ($0.5 after-tax) for the three and six months ended
July 2, 2023, as a result of the sale process for the part of its
eOne TV and film business not directly supporting the Company's
Branded Entertainment Strategy.
(6) Non-cash Goodwill and Asset impairment
charges of $296.2 ($279.9 after tax) for the three and six months
ended July 2, 2023 incurred within the Entertainment segment, of
which $231.2 related to the goodwill impairment of Film & TV
due to the expected economic impact of industry factors and $65.0
related to an impairment of the Company's definite-lived
intangible, eOne Trademark, which is included in Selling,
Distribution and Administration.
HASBRO, INC.
NON-GAAP RECONCILIATION
(Unaudited)
(Millions of Dollars and Shares, Except
Per Share Data)
Reconciliation of
Net Earnings and Earnings per Share (1)
Three Months Ended
June 30, 2024
Diluted Per Share
Amount
July 2, 2023
Diluted Per Share
Amount
Net Earnings (Loss) Attributable to
Hasbro
$
138.5
$
0.99
$
(235.0
)
$
(1.69
)
Acquisition and Related Costs
—
—
—
—
Acquired Intangible Amortization
9.3
0.07
14.3
0.10
Operational Excellence
7.0
0.05
8.0
0.06
Brand Blueprint implementation charges
15.3
0.11
0.5
—
Impairment of Goodwill and Intangible
Assets
—
279.9
2.01
Net Earnings Attributable to Hasbro as
Adjusted
$
170.1
$
1.22
$
67.7
$
0.49
Six Months Ended
June 30, 2024
Diluted Per Share
Amount
July 2, 2023
Diluted Per Share
Amount
Net Earnings (Loss) Attributable to
Hasbro
$
196.7
$
1.41
$
(257.1
)
$
(1.85
)
Acquisition and Related Costs
—
—
1.7
0.01
Acquired Intangible Amortization
18.6
0.13
27.6
0.20
Operational Excellence
15.3
0.11
16.1
0.12
Brand Blueprint implementation charges
24.4
0.18
0.5
—
Impairment of Goodwill and Intangible
Assets
—
—
279.9
2.02
Net Earnings Attributable to Hasbro as
Adjusted
$
255.0
$
1.83
$
68.7
$
0.49
(1) Amounts may not sum due to
rounding
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240724788818/en/
Investors: Kern Kapoor | Hasbro, Inc. |
hasbro_investor_relations@hasbro.com Media: Roberta Thomson |
Hasbro, Inc. | bertie.thomson@hasbro.com
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