PAWTUCKET, R.I. – Hasbro Inc. (HAS), the nation's second-largest toy maker, said Monday it swung to a loss in the latest first quarter from year-ago profit, due to lower revenue and higher costs.
Quarterly losses totaled $3.7 million, or 2 cents per share, compared with earnings of $6.5 million, or 3 cents per share, a year ago.
Net revenue was down 4 percent to $454.9 million from $474.2 million a year ago, including a $7 million positive impact from foreign exchange. Toy segment net revenue grew 9 percent, reflecting the initial shipment of Star Wars (search) products in advance of the May 19 movie release.
Analysts surveyed by Thomson Financial were looking for the company to report earnings of 4 cents per share on sales of $488 million in the latest quarter.
"While our first quarter performance was mixed, overall, results were in line with our expectations as our business continues to be more weighted to the back half of the year," said Alfred J. Verrecchia, president and CEO.
Revenue in the Games segment fell to $99 million for the quarter from $127.6 million a year ago. The Games segment reported operating profit of $1.2 million, down sharply from $19.6 million last year, primarily due to a decline in volume — particularly in trading card games which have a higher margin than the board game business.
"Due to the actions we have taken over the last few years to significantly lower our breakeven point, we delivered an operating profit despite lower revenue," said Chief Financial Officer David Hargreaves. "This reduced breakeven point, combined with our strengthened balance sheet, positions us to deliver improved profitability this year."
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