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Hasbro hit with 12 per cent drop in full year revenue

The global toymaker has blamed the collapse of Toys R Us and the shifting retail landscape for it dip in 2018, but is primed for growth with new properties and launches for 2019

Hasbro has seen its full year net revenues decrease 12 per cent to $4.58 billion, reflecting a loss of revenues through the collapse of Toys R Us over the past year.

On top of this, revenues declined internationally, most notably in Europe where the company has addressed changing consumer shopping behaviours and an evolving retail landscape.

The toymaker has reported net earnings for the full year 2018 of $220.4 million compared to $396.6 million in 2017. Adjusted 2018 net earnings were $488.8 million.

“2018 was a very disruptive year, driven by the bankruptcy and liquidation of Toys R Us across most of the world and a rapidly shifting consumer and retail landscape,” said Brian Goldner, Hasbro’s chairman and chief executive officer.

“During 2018, we diversified our retailer base, meaningfully lowered retailer inventories and delivered innovative new offerings to our global consumers. We were not, however, able to recapture as much of the Toys R Us business during the holiday period as we anticipated as the effect of its liquidated inventory in the market was more impactful than we and industry experts expected.

“In addition, as we discussed throughout the year, our European shipments declines as the teams successfully lowered retailer inventories amidst a declining toy and game market.

“Throughout 2018, we engaged in several major innovation initiatives and initiated significant organisational changes to enable us to stabilise our European business in 2019 and return Hasbro to profitable growth this year.”

Goldner highlighted that over the course of 2019, Hasbro will be looking at reinvigorated sales from the latest innovations from Nerf, a new Power Rangers line hitting the market in the second quarter and the launch of its digital game Magic: The Gathering Arena.

Entertainment properties will also provide a boost through Captain Marvel and Avengers: Endgame, Spider-Man: Far From Home, Disney’s Frozen 2 and Star Wars: Episode IX.

Deborah Thomas, Hasbro’s chief financial officer, added: “Despite the challenging year, Hasbro remains in a strong financial position with the ability to continue investing to drive profitable long-term growth and raise our quarterly dividend eight per cent in 2019.

“Given the rapid change in our business, our global teams are focused on identifying incremental opportunities to deliver top and bottom line returns. Investments to drive top line growth include the acquisition of Power Rangers, storytelling such as Bumblebee and new growth drivers including Magic: The gathering Arena and the associated Magic esports initiatives.”

Written by Robert Hutchins

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