Hasbro revenue up, profit down on tax code changes

HASBRO grew revenue year over year in 2017, but saw profit decline due to repatriation taxes driven by the new tax code. / BLOOMBERG FILE PHOTO/DANIEL ACKER
HASBRO grew revenue year over year in 2017, but saw profit decline due to repatriation taxes driven by the new tax code. / BLOOMBERG FILE PHOTO/DANIEL ACKER

PROVIDENCE – Hasbro Inc. reported net income of $396.6 million for 2017, which thanks to a $296.5 million charge as a result of the federal tax overhaul, represented a 25.6 percent year-over-year decline. Removing the effects of the one-time repatriation of tax assets, the company estimated that its net income for the year would have been $693.1 million, which would have represented a 30 percent increase in earnings.

Diluted earnings per share for 2017 were $3.12 compared with $4.34 a year prior. Yearly revenue increased 3.8 percent year over year to $5.2 billion. That total compares with net sales for Mattel Inc. for the year of $4.9 billion, the first time since 1993 that Hasbro has had more yearly revenue than Mattel since 1993, according to the Wall St. Journal.

The company reported a $5.3 million loss for the 2017 fourth quarter, compared to a $180.6 million profit the year prior. Removing the effects of the tax law change, the company said that fourth-quarter net income would have been $291.2 million. The company posted fourth-quarter revenue of $1.6 billion, a 2.1 percent year-over-year drop. Loss per diluted share for the quarter was 4 cents, compared with earnings of $1.52 last year.

Hasbro’s Franchise Brand revenue increased 10.3 percent to $2.6 billion in 2017. The company’s Partner Brands segment experienced a 10 percent decline to $1.3 billion over the year, while Hasbro Gaming revenue grew 9.8 percent to $893 million. Emerging Brands revenue increased 2.4 percent to $477.2 million for the year.

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While the company did make estimates for the effects of the federal tax overhaul, Chief Financial Office Deborah M. Thomas said that the company may make adjustments in the coming year as the full effects of the Tax Cuts and Jobs Act become clear.

Chairman and CEO Brian Goldner noted that consumer demand slowed in November and December for the industry and the company, but said “our innovative lines are supported by robust storytelling and digital initiatives that position us well for 2018 and beyond.s”

Chris Bergenheim is the PBN web editor.