Pawtucket-based Hasbro Inc., the world’s second-largest toymaker, said third-quarter earnings climbed 23 percent,
helped by sales of newer toys such as Beyblade spinning tops. The
company may close a manufacturing plant in Spain.
Net income rose to $68.5 million, or 38 cents a share, from
$55.8 million, or 32 cents, a year earlier, the company said in a statement. Sales rose 18 percent
to $971.1 million.
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Chief Executive Alfred Verrecchia has boosted sales by
introducing products such as VideoNow and FurReal Friends and
focusing on classic toys such as Transformers, Playskool and
Trivial Pursuit games to lessen the company’s reliance on fads
such as Pokemon cards and movie-related toys. The product lineup
will help holiday sales, he said.
“The core products are what’s driving the operating
performance,” said John Miller, who helps manage about $13 billion in assets at Ariel Capital Management, including about 14 million Hasbro shares as of last month. “Some of the newer
products that have come out are like icing on the cake.”
Shares of Hasbro have risen 79 percent this year.
Profit before an accounting change of 10 cents was 48 cents
a share, the company said. On that basis, Hasbro had been
expected to earn 42 cents, the average forecast of analysts
surveyed by Thomson Financial.
Potential expenses for the possible plant closing may be
recorded as early as this quarter, Chief Financial Officer David
Hargreaves said on a conference call with analysts and investors.
The amount of any potential expenses isn’t expected to affect the
company’s goal of increasing operating margin by at least 10
percent this year, spokesman Wayne Charness said.
Revenue from the company’s U.S. toy business rose 23 percent, while climbing 22 percent in the international segment.
Sales of games including Monopoly increased 11 percent. Last
quarter’s results also were helped by lower interest expenses as
Hasbro pared some debt. The company said it has increased market
share and shelf space.
Mattel Inc., the largest U.S. toy company by sales, said
last week that its third-quarter profit declined 3.8 percent.
Bloomberg News
