Hasbro Profit Rises on Playskool, Transformers
Hasbro, the second-largest U.S. toy company, posted a higher quarterly profit Monday, helped by sales at its Playskool brand and continued strong demand for products tied to the Transformers movie.
The maker of Nerf balls and the board game Monopoly said third-quarter earnings rose to $161.6 million, or 95 cents a share, from $99.6 million, or 58 cents a share, a year earlier.
Excluding a gain from a tax adjustment, profit was 78 cents a share. Analysts on average were expecting 71 cents, according to Reuters Estimates.
Hasbro said quarterly sales rose 18 percent to $1.22 billion. Analysts were expecting about $1.14 billion.
Sales rose 10 percent at Hasbro's North American division and 33 percent in the international segment.
"We are well positioned for the all-important holiday season," Chief Executive Alfred Verrecchia said in a statement.
Hasbro said it had repurchased 12.9 million shares of common stock for $362.1 million during the quarter.
The results came a week after industry leader Mattel posted a slightly lower quarterly profit because of costs and disruptions from its recent global recalls of potentially dangerous toys.
Although Hasbro's toys were not among those plucked from shelves worldwide due to lead paint or magnet hazards, the company might still feel the effects of consumer wariness, Sterne Agee analyst Margaret Whitfield said in an Oct. 17 research note.
"The recall issue may have impacted consumer demand for toys across the board," wrote Whitfield, who has a "buy" rating on Hasbro's stock.
But Hasbro might also benefit from consumer defections from Mattel brands, like Polly Pocket and Fisher-Price, that have seen recalls, Whitfield added.