Hasbro, Inc. (HAS)
Q1 2010 Earnings Call
April 19, 2010 8:30 am ET
Karen Warren - Senior Vice President Investor Relations
Brian Goldner - President and Chief Executive Officer
David Hargreaves - Chief Operating Officer
Deb Thomas - Chief Financial Officer
Sean McGowan – Needham & Co.
Greg Badishkanian – Citigroup
Tony Gikas – Piper Jaffray
Gerrick Johnson – BMO Capital Markets
Drew Crum – Stifel Nicolaus
Tim Conder – Wells Fargo
Hayley Wolff - Rochdale Securities
John Taylor – Arcadia
Robert Carroll – UBS
Jeff Blaeser – Morgan Joseph
Previous Statements by HAS
» Hasbro, Inc. Q4 2009 Earnings Call Transcript
» Hasbro Q3 2009 Earnings Call Transcript
» Hasbro Q2 2009 Earnings Call Transcript
Joining me today are Brian Goldner, President and Chief Executive Officer, David Hargreaves, Chief Operating Officer and Deb Thomas, Chief Financial Officer.
To better understand our results, it would be helpful to have the press release and financial tables available that we issued earlier today. The press release includes information regarding non-GAAP financial measures discussed on today’s call and it is available on our website at Hasbro.com. We would also like to point out that on this call whenever we discuss earnings per share or EPS, we are referring to earnings per diluted share. During the call this morning, Brian will discuss key factors impacting our results and Deb will review the financials. We will then open the call to your questions.
Before we begin, let me note that during this call and the question and answer session that follow, members of Hasbro management may make forward looking statements concerning management’s expectations, goals, objectives and similar matters. These forward looking statements may include comments concerning our product plans, anticipated product performance, business opportunities and strategies, financial goals and expectations for future financial performance in achieving our objectives.
There are many factors that could cause actual results and experiences to differ materially from the anticipated results or other expectations expressed in these forward looking statements. Some of those factors are set forth in our annual report on Form 10-K, in today’s press release and in our other public disclosures. We undertake no obligation to update any forward looking statements made today to reflect events or circumstances occurring after the date of this call.
Now I would like to introduce Brian Goldner.
The Hasbro team globally continued to execute our strategy well and we delivered a strong first quarter performance. Hasbro grew its business across all our major product categories including boys, games and puzzles, girls, and preschool. We grew revenues in the US and Canada segment and across all regions of the international segment, including Europe, Mexico and Latin America and Asia/Pacific.
As we look at Hasbro’s mega brand performance; Littlest Pet Shop, Monopoly, Magic the Gathering, Nerf, and Playskool all grew in the quarter. In addition, Baby Alive, Play-doh, Tonka, FurReal Friends, and Super Soaker were all up versus a year ago. The Iron Man brand also contributed to the growth in our global boys business in the quarter. We are excited for the opening of Iron Man 2 scheduled for May 7th.
In February, we shared with you that in order grow our business in 2010 we needed to deliver growth across our portfolio of brands. The first quarter is a good first step toward that end. The comparisons in the second quarter become more of a challenge as we anniversary the movie ship ins for both Transformers and G.I. Joe in 2009.
Foreign currency trends have also become less of a tailwind than we initially anticipated for the year. Having said this, we continue to believe we should be able to grow revenues and earnings per share for the full year 2010, including the dilution from our television investments and absent a further deterioration in the value of foreign currencies, consumer spending, or global economic conditions.
Next, we will execute our global strategy as we continue to transform Hasbro into a branded play company. Our entertainment initiatives remain on track. Transformers 3 is scheduled for release on July 1, 2011. Frances McDormand and John Malkovich have been added to the already great cast. Stretch Armstrong is slated for summer 2012 staring Taylor Lautner and its being filmed in 3-D. Battleship is planned for May 25, 2012 and will be production shortly. Taylor Kitsch, who stared in the television series Friday Night Lights, as well as in Marvel’s Wolverine, is our lead for Battleship.
In support of our television initiatives, Hasbro studios continues to ramp up development and production in line with our plans. The team currently has 317 half hours of programming in development and production for distribution to The Hub network and international markets. We are delighted with the talent on board at the studio and all key roles are filled with the most recent addition being Finn Arnesen. Finn joins Hasbro Studios from Cartoon Network in Europe and will be Senior Vice President International Distribution and Development, charged with selling Hasbro Studios programming in all key markets around the world.
The Hub, our joint venture children’s television network with Discovery Communications, will be launching on 10/10/10. Margaret Loesch and her team have been meeting with potential advertisers over the past several weeks and the reception has been very positive. The Hub will feature a number of day parts targeting preschool and kids during the day and in the evening will offer families an opportunity to enjoy television together. We will provide more details on Hasbro Studios productions and the launch of The Hub in the coming weeks.