Hasbro Reports Earnings Up 23 Percent

Hasbro Inc. (HAS), the nation's second-largest toy maker behind Mattel Inc. (MAT), said its earnings rose 23 percent in the fourth quarter due to its strong sales of new products and classic board games and core brands.

The Pawtucket-based toy maker on Monday said it earned $76.6 million, or 43 cents per share for the three months ended Dec. 28. That compared with $62.16 million, or 36 cents per share, in the year-ago period.

Revenues in the fourth quarter were $1.12 billion, up 12 percent from $997.4 million in the year-ago period.

The earnings results included charges of $18.4 million related to severance payments stemming from the cessation of toy manufacturing operations at its Valencia, Spain, facility and $14 million related to exiting leases and severances for employees of the remaining Wizards of the Coast retail stores. The company also had a $20.3 million charge related to the December bond tender offer, primarily comprised of the premium paid to bondholders that participated in the tender offer.

The company said that the bankruptcy filling of KB Toys did not have a "significant impact " on fourth-quarter results.

Alfred Verrecchia, Hasbro's chief executive officer, said that the company continues to believe it can increase revenue between 3 to 5 percent per year. The company expects to deliver operating margins of 12 percent or better by the end of 2005.

Growth was led by new products such as Beyblade and Furreal Friends, as well as strong performances by core brands such as Transformers and Playskool.

For the year, Hasbro's earnings were $157.6 million, or 88 cents per share, compared with a loss of $170.67 million, or 98 cents a share, in 2002. Worldwide revenues grew 11.4 percent to $3.14 billion, compared to $2.82 billion in 2002.

Shares of Hasbro were down 8 cents to $20.61 in early trading on the New York Stock Exchange.