Hasbro Reports Second Quarter 2023 Financial Results
Pawtucket, RI — Hasbro reported financial results for the second quarter 2023.
“The Hasbro team delivered a solid second quarter, with revenue ahead of our expectations, significant reduction of inventory, and meaningful progress toward our transformation and cost savings programs,” said Chris Cocks, Hasbro chief executive officer. “New products are delighting our fans around the world, including the return of FURBY and the release of MAGIC: THE GATHERING’s Universes Beyond set, The Lord of the Rings: Tales of Middle-earth, which is already the second largest set in MAGIC’s history. TRANSFORMERS entertainment and innovation is driving strong growth in the brand.
“Importantly, we announced an agreement to sell our eOne Film and TV business to Lionsgate, where it will be in good hands, and expect to close the transaction by year end,” continued Cocks. “Storytelling is part of our mission, and Hasbro will keep producing compelling entertainment that helps bring our beloved brands to life. The sale allows us to focus on our core toy and game expertise, partner with the industry’s best, and strengthen our balance sheet as we invest to drive long-term growth and return cash to shareholders.”
“Through the first six months, our results have been at or above our plan,” said Gina Goetter, Hasbro chief financial officer. “Looking at our full year, our Consumer Products segment remains on track and our Wizards of the Coast and Digital Gaming segment is performing better than expected. Positive proof points are emerging across a variety of our transformation initiatives as we lower costs, improve productivity, and reset Hasbro for profitable growth. Selling our eOne Film and TV business will give us greater focus and financial flexibility moving forward, including paying down a minimum of $400 million in floating rate debt.”
Highlights
- Q2 Hasbro, Inc. revenue declined 10%, ahead of expectations, driven by stronger than planned point of sale trends within Consumer Products.
- Announced sale of eOne Film & TV business enabling focus on core toy and game brands; expected to close in the back-half of 2023.
- Meaningful progress on transformation; delivered $84 million of cost savings under the Operational Excellence Program in the first half of 2023.
- Reduced owned inventory level by 16% versus prior year driven by Consumer Products; global Retail inventory down 16%.
- Reaffirming outlook on Consumer Products segment and increasing revenue growth guidance for Wizards of the Coast and Digital Gaming segment.
- Updating guidance on Entertainment segment to reflect the reality of the writers’ and actors’ strikes impact on production deliveries.
- Launched compelling innovation across toys and games: MAGIC: THE GATHERING Universes Beyond The Lord of the Rings: Tales of Middle-earth; MONOPOLY NBA Prizm and Super Mario Brothers editions.
Second Quarter and First Half 2023 Financial Results
|
$ Millions, except earnings per share |
Q2 2023 |
Q2 2022 |
% Change |
1H 2023 |
1H 2022 |
% Change |
||||
|
Net Revenues1 |
$ |
1,210.0 |
$ |
1,339.2 |
-10% |
$ |
2,211.0 |
$ |
2,502.3 |
-12% |
|
|
|
|
|
|
|
|
||||
|
Operating Profit (Loss) |
$ |
(188.6) |
$ |
219.1 |
>-100% |
$ |
(170.7) |
$ |
339.1 |
>-100% |
|
Adjusted Operating Profit2 |
$ |
136.8 |
$ |
241.0 |
-43% |
$ |
184.0 |
$ |
382.8 |
-52% |
|
|
|
|
|
|
|
|
||||
|
Net Earnings (Loss) |
$ |
(235.0) |
$ |
142.0 |
>-100% |
$ |
(257.1) |
$ |
203.2 |
>-100% |
|
Net Earnings (Loss) per Diluted Share |
$ |
(1.69) |
$ |
1.02 |
>-100% |
$ |
(1.85) |
$ |
1.46 |
>-100% |
|
|
|
|
|
|
|
|
||||
|
Adjusted Net Earnings2 |
$ |
67.7 |
$ |
160.6 |
-58% |
$ |
68.7 |
$ |
240.0 |
-71% |
|
Adjusted Net Earnings per Diluted Share2 |
$ |
0.49 |
$ |
1.15 |
-57% |
$ |
0.49 |
$ |
1.72 |
-72% |
|
|
|
|
|
|
|
|
||||
|
EBITDA2 |
$ |
(127.9) |
$ |
285.4 |
>-100% |
$ |
(55.5) |
$ |
459.4 |
>-100% |
|
Adjusted EBITDA2 |
$ |
198.6 |
$ |
308.3 |
-36% |
$ |
297.3 |
$ |
500.4 |
-41% |
|
1Foreign exchange had a negative $3.5 million and $19.3 million impact on second quarter and first half 2023 revenue, respectively. |
||||||||||
Second Quarter and First Half 2023 Segment Performance
|
Q2 2023 Major Segments |
Net Revenues |
Operating Profit |
Adjusted |
||||||||||
|
Q2 2023 |
Q2 2022 |
% Change |
Q2 2023 |
Q2 2022 |
Q2 2023 |
Q2 2022 |
|||||||
|
Consumer Products |
$ |
655.2 |
$ |
734.2 |
-11% |
$ |
11.4 |
$ |
(6.5) |
$ |
22.2 |
$ |
3.1 |
|
Wizards of the Coast and Digital Gaming |
$ |
375.6 |
$ |
419.8 |
-11% |
$ |
142.3 |
$ |
225.6 |
$ |
142.3 |
$ |
225.6 |
|
Entertainment |
$ |
179.2 |
$ |
185.2 |
-3% |
$ |
(324.2) |
$ |
14.3 |
$ |
(20.8) |
$ |
23.0 |
|
Corporate and Other |
N/A |
N/A |
N/A |
$ |
(18.1) |
$ |
(14.3) |
$ |
(6.9) |
$ |
(10.7) |
||
|
1H 2023 Major Segments |
Net Revenues |
Operating Profit (Loss) |
Adjusted |
||||||||||
|
1H 2023 |
1H 2022 |
% Change |
1H 2023 |
1H 2022 |
1H 2023 |
1H 2022 |
|||||||
|
Consumer Products |
$ |
1,175.6 |
$ |
1,407.0 |
-16% |
$ |
(34.6) |
$ |
2.1 |
$ |
(13.2) |
$ |
22.0 |
|
Wizards of the Coast and Digital Gaming |
$ |
670.8 |
$ |
682.6 |
-2% |
$ |
219.1 |
$ |
332.0 |
$ |
219.1 |
$ |
332.0 |
|
Entertainment |
$ |
364.6 |
$ |
412.7 |
-12% |
$ |
(332.9) |
$ |
26.5 |
$ |
(23.3) |
$ |
44.0 |
|
Corporate and Other |
N/A |
N/A |
N/A |
$ |
(22.3) |
$ |
(21.5) |
$ |
1.4 |
$ |
(15.2) |
||
|
1See the financial tables accompanying this press release for a reconciliation of GAAP and non-GAAP financial measures, namely, adjusted operating profit, adjusted net earnings, adjusted net earnings per share and adjusted EBITDA. Including, among other items, $296.2 million ($279.9 million after tax) non-cash Goodwill and Asset impairment charges within the Entertainment segment. |
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Second Quarter 2023 Segment Commentary & FY 2023 Outlook
Consumer Products Segment
- Revenue decrease of 11% driven by business exits and a continued focus on inventory reduction; partially offset by growth of 18% in Consumer Products Licensing behind concerted efforts to leverage IP across new partnerships.
- Adjusted operating profit margin of 3.4% grew 3 margin points versus last year driven by cost savings, improved mix from licensing revenue growth and lower royalties.
Wizards of the Coast and Digital Gaming Segment
- Revenue decrease of 11% driven by tabletop revenue which, as expected, was impacted by one fewer MAGIC: THE GATHERING set release in Q2 compared to 2022.
- Digital and licensed gaming revenue increase of 33%, bolstered by the addition of D&D Beyond and growth in Magic: The Gathering Arena.
- Operating profit decline of 37% due to lower revenue, higher royalty expense associated with Universes Beyond and increased investments.
Entertainment Segment
- Revenue decline of 3% driven by exited businesses partially offset by growth across scripted TV and Family Brands.
- Operating loss includes $296 million non-cash Goodwill and Asset impairment charges for second quarter and six months; $231 million is related to the goodwill impairment of Film & TV due to the expected economic impact of industry factors and $65 million related to an intangible impairment of the eOne Trademark.
- Adjusted operating loss for the second quarter includes a $25.0 million Dungeons & Dragons: Honor Among Thieves production asset impairment charge.
Second Quarter and First Half 2023 Brand Portfolio
|
Brand Performance1 |
Net Revenues |
|||||||||
|
Q2 2023 |
Q2 2022 |
% Change |
1H 2023 |
1H 2022 |
% Change |
|||||
|
Franchise Brands |
$ |
788.4 |
$ |
826.0 |
-5% |
$ |
1,401.8 |
$ |
1,476.4 |
-5% |
|
Partner Brands |
$ |
172.9 |
$ |
219.4 |
-21% |
$ |
305.6 |
$ |
425.9 |
-28% |
|
Portfolio Brands |
$ |
107.1 |
$ |
135.8 |
-21% |
$ |
199.1 |
$ |
248.4 |
-20% |
|
Non-Hasbro Branded Film & TV |
$ |
141.6 |
$ |
158.0 |
-10% |
$ |
304.5 |
$ |
351.6 |
-13% |
|
1Effective in the first quarter of 2023, the Company realigned its Brand Portfolios to Franchise Brands, Partner Brands, Portfolio Brands and Non-Hasbro Branded Film & TV. Franchise Brands include DUNGEONS & DRAGONS, Hasbro Gaming, MAGIC: THE GATHERING, NERF, PEPPA PIG, PLAY-DOH and TRANSFORMERS. A schedule of historical quarterly revenue is available at https://investor.hasbro.com/ under Financials & Filings. |
||||||||||
Franchise Brands
- Franchise Brands revenue was down 5% in the quarter driven by macro trends and inventory reductions.
- Delivered significant Q2 revenue growth in TRANSFORMERS and DUNGEONS & DRAGONS.
- PEPPA PIG grew as a result of growth in entertainment and digital gaming.
- Hasbro Gaming was flat and the other Franchise Brands declined.
Partner Brands
- Total Partner Brand revenue was down 21% in the quarter due to license exits.
- Sales of Hasbro products for Spider-Man by Marvel are up with an over 100% increase in point-of-sale year-over-year since the release of Spider-Man: Across the Spider-Verse and further supported by the preschool series, evergreen marketing and new product releases.
Portfolio Brands
- The decline in Portfolio Brands is driven by the reprioritization of investment to support Franchise Brands, as well as discontinuances across the retail footprint.
Second Quarter and First Half 2023 MAGIC: THE GATHERING and Hasbro Total Gaming
|
|
Net Revenues |
|||||||||
|
$ Millions |
Q2 2023 |
Q2 2022 |
% Change |
1H 2023 |
1H 2022 |
% Change |
||||
|
MAGIC: THE GATHERING |
$ |
311.0 |
$ |
365.5 |
-15% |
$ |
540.1 |
$ |
562.7 |
-4% |
|
Hasbro Total Gaming1 |
$ |
491.2 |
$ |
528.3 |
-7% |
$ |
877.7 |
$ |
907.1 |
-3% |
1Hasbro’s Total Gaming Category includes all gaming revenue, most notably MAGIC: THE GATHERING, Hasbro Gaming and DUNGEONS & DRAGONS.
MAGIC: THE GATHERING
- Revenue decrease of 15% due to the timing of set releases with one fewer release compared to prior year.
- The newest Universes Beyond set, The Lord of the Rings: Tales of Middle-earth, was the second biggest launch sell-in ever and is tracking to be the biggest selling MAGIC set of all time.
- Fans continue to return to organized play as MagicCon Barcelona just finished and the MAGIC World Championships return to Las Vegas from September 22 to 24.
Capital Priorities and Dividend
During the second quarter and year-to-date, Hasbro paid $97 million and $194 million, respectively, in cash dividends to shareholders. The next dividend of $0.70 per common share was previously declared and will be payable on August 15, 2023 to shareholders of record at the close of business on August 1, 2023.
The Company continues to target Debt to EBITDA ratio of 2.0 to 2.5 times. For 2023, progress is expected against this target. Pending the outcome of the sale of the eOne Film and TV business, the Company anticipates prioritizing the sale proceeds toward paying down debt. The Company remains committed to maintaining its investment grade rating.
Operational Excellence
In support of Hasbro’s Blueprint 2.0 strategy, Hasbro implemented an Operational Excellence program to deliver $250-300 million in annualized run-rate cost savings by year-end 2025. In the first half 2023, the Company realized $84 million of savings and is on track to achieve $150 million of in-year cost savings for the full-year 2023
Company Outlook
The outlook across the Consumer Products Segment is unchanged and Wizards of the Coast and Digital Gaming Segment revenue outlook is higher than prior guidance. Entertainment Segment guidance is updated to reflect the reality of the writers’ and actors’ strikes on the eOne Film and TV business. The updated guidance assumes eOne Film and TV is included for the entire fiscal year and guidance will be updated once the eOne Film and TV sale transaction is complete.
The Company now expects:
- Revenue decline of 3-6% driven by the Entertainment Segment.
- No change to Consumer Product guidance of down mid-single digits.
- Increasing guidance on Wizards of the Coast Segment to up high-single digits.
- Reducing outlook on Entertainment to down 25 to 30%.
- Adjusted operating margin up 20 to 50 basis points versus last year’s adjusted operating margin1
- Consumer Products segment and Wizards and Digital Gaming segment margin outlook unchanged from prior guidance.
- Entertainment segment margin is now expected to decline as a result of the D&D film impairment and the ongoing industry strikes.
The Company continues to expect:
- Adjusted EBITDA approximately flat with 2022 adjusted EBITDA.
- Operating Cash Flow of $600 to $700 million.
1
HAS-E
| HASBRO, INC. |
|
|
|
||||
|
CONDENSED CONSOLIDATED BALANCE SHEETS (1) |
|
|
|
||||
|
(Unaudited) |
|
|
|
||||
|
(Millions of Dollars) |
|
|
|
||||
|
|
|
|
|
||||
|
|
July 2, 2023 |
|
June 26, 2022 |
||||
|
ASSETS |
|
|
|
||||
|
Cash and Cash Equivalents |
$ |
216.6 |
|
$ |
628.2 |
||
|
Accounts Receivable, Net |
|
877.0 |
|
|
|
870.5 |
|
|
Inventories |
|
731.3 |
|
|
|
867.5 |
|
|
Prepaid Expenses and Other Current Assets |
|
684.1 |
|
|
|
719.2 |
|
|
Total Current Assets |
|
2,509.0 |
|
|
|
3,085.4 |
|
|
Property, Plant and Equipment, Net |
|
515.4 |
|
|
|
409.9 |
|
|
Goodwill |
|
3,239.2 |
|
|
|
3,483.2 |
|
|
Other Intangible Assets, Net |
|
724.8 |
|
|
|
1,156.9 |
|
|
Other Assets |
|
1,621.3 |
|
|
|
1,367.6 |
|
|
Total Assets |
$ |
8,609.7 |
|
|
$ |
9,503.0 |
|
|
|
|
|
|
||||
|
|
|
|
|
||||
|
LIABILITIES, NONCONTROLLING INTERESTS AND SHAREHOLDERS’ EQUITY |
|||||||
|
Short-Term Borrowings |
$ |
148.2 |
|
|
$ |
98.0 |
|
|
Current Portion of Long-Term Debt |
|
69.4 |
|
|
|
137.0 |
|
|
Accounts Payable and Accrued Liabilities |
|
1,732.8 |
|
|
|
1,923.2 |
|
|
Total Current Liabilities |
|
1,950.4 |
|
|
|
2,158.2 |
|
|
Long-Term Debt |
|
3,668.5 |
|
|
|
3,739.0 |
|
|
Other Liabilities |
|
520.6 |
|
|
|
570.0 |
|
|
Total Liabilities |
|
6,139.5 |
|
|
|
6,467.2 |
|
|
Redeemable Noncontrolling Interests |
|
— |
|
|
|
23.0 |
|
|
Total Shareholders’ Equity |
|
2,470.2 |
|
|
|
3,012.8 |
|
|
Total Liabilities, Noncontrolling Interests and Shareholders’ Equity |
$ |
8,609.7 |
|
|
$ |
9,503.0 |
|
|
(1) Amounts may not sum due to rounding |
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|
HASBRO, INC. |
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|
CONSOLIDATED STATEMENTS OF OPERATIONS (1) |
||||||||||||||||||||||||||||
|
(Unaudited) |
||||||||||||||||||||||||||||
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(Millions of Dollars and Shares Except Per Share Data) |
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|
|
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||||||||||||
|
|
|
Quarter Ended |
|
Six Months Ended |
||||||||||||||||||||||||
|
|
|
July 2, 2023 |
|
% Net Revenues |
|
June 26, 2022 |
|
% Net Revenues |
|
July 2, 2023 |
|
% Net Revenues |
|
June 26, 2022 |
|
% Net Revenues |
||||||||||||
|
Net Revenues |
|
$ |
1,210.0 |
|
|
100.0 |
% |
|
$ |
1,339.2 |
|
|
100.0 |
% |
|
$ |
2,211.0 |
|
|
100.0 |
% |
|
$ |
2,502.3 |
|
|
100.0 |
% |
|
Costs and Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Cost of Sales |
|
|
352.2 |
|
|
29.1 |
% |
|
|
411.5 |
|
|
30.7 |
% |
|
|
637.5 |
|
|
28.8 |
% |
|
|
744.6 |
|
|
29.8 |
% |
|
Program Cost Amortization |
|
|
134.4 |
|
|
11.1 |
% |
|
|
80.7 |
|
|
6.0 |
% |
|
|
256.9 |
|
|
11.6 |
% |
|
|
219.2 |
|
|
8.8 |
% |
|
Royalties |
|
|
119.9 |
|
|
9.9 |
% |
|
|
110.1 |
|
|
8.2 |
% |
|
|
188.9 |
|
|
8.5 |
% |
|
|
200.2 |
|
|
8.0 |
% |
|
Product Development |
|
|
72.4 |
|
|
6.0 |
% |
|
|
79.2 |
|
|
5.9 |
% |
|
|
155.7 |
|
|
7.0 |
% |
|
|
148.8 |
|
|
5.9 |
% |
|
Advertising |
|
|
85.1 |
|
|
7.0 |
% |
|
|
84.2 |
|
|
6.3 |
% |
|
|
167.9 |
|
|
7.6 |
% |
|
|
161.8 |
|
|
6.5 |
% |
|
Amortization of Intangibles |
|
|
22.8 |
|
|
1.9 |
% |
|
|
27.2 |
|
|
2.0 |
% |
|
|
45.9 |
|
|
2.1 |
% |
|
|
54.3 |
|
|
2.2 |
% |
|
Selling, Distribution and Administration |
|
|
380.6 |
|
|
31.5 |
% |
|
|
327.2 |
|
|
24.4 |
% |
|
|
697.7 |
|
|
31.6 |
% |
|
|
634.3 |
|
|
25.3 |
% |
|
Impairment of Goodwill |
|
|
231.2 |
|
|
19.1 |
% |
|
|
— |
|
|
0.0 |
% |
|
|
231.2 |
|
|
10.5 |
% |
|
|
— |
|
|
0.0 |
% |
|
Operating Profit (Loss) |
|
|
(188.6 |
) |
|
-15.6 |
% |
|
|
219.1 |
|
|
16.4 |
% |
|
|
(170.7 |
) |
|
-7.7 |
% |
|
|
339.1 |
|
|
13.6 |
% |
|
Interest Expense |
|
|
46.6 |
|
|
3.9 |
% |
|
|
41.7 |
|
|
3.1 |
% |
|
|
92.9 |
|
|
4.2 |
% |
|
|
83.3 |
|
|
3.3 |
% |
|
Other Expense (Income), Net |
|
|
(7.3 |
) |
|
-0.6 |
% |
|
|
(2.5 |
) |
|
-0.2 |
% |
|
|
(14.7 |
) |
|
-0.7 |
% |
|
|
(4.3 |
) |
|
-0.2 |
% |
|
Earnings (Loss) before Income Taxes |
|
|
(227.9 |
) |
|
-18.8 |
% |
|
|
179.9 |
|
|
13.4 |
% |
|
|
(248.9 |
) |
|
-11.3 |
% |
|
|
260.1 |
|
|
10.4 |
% |
|
Income Tax Expense |
|
|
7.0 |
|
|
0.6 |
% |
|
|
39.4 |
|
|
2.9 |
% |
|
|
7.7 |
|
|
0.3 |
% |
|
|
56.7 |
|
|
2.3 |
% |
|
Net Earnings (Loss) |
|
|
(234.9 |
) |
|
-19.4 |
% |
|
|
140.5 |
|
|
10.5 |
% |
|
|
(256.6 |
) |
|
-11.6 |
% |
|
|
203.4 |
|
|
8.1 |
% |
|
Net Earnings (Loss) Attributable to Noncontrolling Interests |
|
|
0.1 |
|
|
0.0 |
% |
|
|
(1.5 |
) |
|
-0.1 |
% |
|
|
0.5 |
|
|
0.0 |
% |
|
|
0.2 |
|
|
0.0 |
% |
|
Net Earnings (Loss) Attributable to Hasbro, Inc. |
|
$ |
(235.0 |
) |
|
-19.4 |
% |
|
$ |
142.0 |
|
|
10.6 |
% |
|
$ |
(257.1 |
) |
|
-11.6 |
% |
|
$ |
203.2 |
|
|
8.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Per Common Share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
Net Earnings (Loss) |
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|
|
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|
||||||||||||
|
Basic |
|
$ |
(1.69 |
) |
|
|
|
$ |
1.02 |
|
|
|
|
$ |
(1.85 |
) |
|
|
|
$ |
1.46 |
|
|
|
||||
|
Diluted |
|
$ |
(1.69 |
) |
|
|
|
$ |
1.02 |
|
|
|
|
$ |
(1.85 |
) |
|
|
|
$ |
1.46 |
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Cash Dividends Declared |
|
$ |
0.70 |
|
|
|
|
$ |
0.70 |
|
|
|
|
$ |
1.40 |
|
|
|
|
$ |
1.40 |
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Weighted Average Number of Shares |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Basic |
|
|
138.8 |
|
|
|
|
|
139.0 |
|
|
|
|
|
138.7 |
|
|
|
|
|
139.2 |
|
|
|
||||
|
Diluted |
|
|
139.0 |
|
|
|
|
|
139.2 |
|
|
|
|
|
138.8 |
|
|
|
|
|
139.4 |
|
|
|
||||
|
(1) Amounts may not sum due to rounding |
||||||||||||||||||||||||||||
|
HASBRO, INC. |
|
|
|
||||
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (1) |
|||||||
|
(Unaudited) |
|
|
|
||||
|
(Millions of Dollars) |
|
|
|
||||
|
|
|
|
|
||||
|
|
Six Months Ended |
||||||
|
|
July 2, 2023 |
|
June 26, 2022 |
||||
|
Cash Flows from Operating Activities: |
|
|
|
||||
|
Net Earnings (Loss) |
$ |
(256.6 |
) |
|
$ |
203.4 |
|
|
Impairment of Goodwill |
|
231.2 |
|
|
|
— |
|
|
Other Non-Cash Adjustments |
|
432.1 |
|
|
|
337.3 |
|
|
Changes in Operating Assets and Liabilities |
|
(287.5 |
) |
|
|
(392.9 |
) |
|
Net Cash Provided by Operating Activities |
|
119.2 |
|
|
|
147.8 |
|
|
|
|
|
|
||||
|
Cash Flows from Investing Activities: |
|
|
|
||||
|
Additions to Property, Plant and Equipment |
|
(112.1 |
) |
|
|
(75.8 |
) |
|
Investments and Acquisitions |
|
— |
|
|
|
(146.3 |
) |
|
Other |
|
(3.7 |
) |
|
|
9.5 |
|
|
Net Cash Utilized by Investing Activities |
|
(115.8 |
) |
|
|
(212.6 |
) |
|
|
|
|
|
||||
|
Cash Flows from Financing Activities: |
|
|
|
||||
|
Proceeds from Long-Term Debt |
|
1.6 |
|
|
|
2.1 |
|
|
Repayments of Long-Term Debt |
|
(90.7 |
) |
|
|
(152.5 |
) |
|
Net Proceeds from Short-Term Borrowings |
|
6.6 |
|
|
|
97.2 |
|
|
Purchases of Common Stock |
|
— |
|
|
|
(124.0 |
) |
|
Stock-Based Compensation Transactions |
|
— |
|
|
|
74.2 |
|
|
Dividends Paid |
|
(193.8 |
) |
|
|
(191.9 |
) |
|
Payments Related to Tax Withholding for Share-Based Compensation |
|
(14.5 |
) |
|
|
(19.6 |
) |
|
Other |
|
(5.4 |
) |
|
|
(5.4 |
) |
|
Net Cash Utilized by Financing Activities |
|
(296.2 |
) |
|
|
(319.9 |
) |
|
|
|
|
|
||||
|
Effect of Exchange Rate Changes on Cash |
|
(3.7 |
) |
|
|
(6.3 |
) |
|
|
|
|
|
||||
|
Net Decrease in Cash and Cash Equivalents |
|
(296.5 |
) |
|
|
(391.0 |
) |
|
|
|
|
|
||||
|
Cash and Cash Equivalents at Beginning of Year |
|
513.1 |
|
|
|
1,019.2 |
|
|
|
|
|
|
||||
|
Cash and Cash Equivalents at End of Period |
$ |
216.6 |
|
|
$ |
628.2 |
|
|
(1) Amounts may not sum due to rounding |
|||||||
|
HASBRO, INC. |
||||||||||||||||||||||||||
|
SUPPLEMENTAL FINANCIAL DATA |
||||||||||||||||||||||||||
|
SEGMENT RESULTS – AS REPORTED AND AS ADJUSTED (9) |
||||||||||||||||||||||||||
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
(Millions of Dollars) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Operating Results |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
|
Quarter Ended July 2, 2023 |
|
Quarter Ended June 26, 2022 |
|
|
|||||||||||||||||||||
|
|
As Reported |
|
Non-GAAP Adjustments |
|
Adjusted |
|
As Reported |
|
Non-GAAP Adjustments |
|
Adjusted |
|
% Change |
|||||||||||||
|
Total Company Results |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
External Net Revenues (1) |
$ |
1,210.0 |
|
|
$ |
— |
|
|
$ |
1,210.0 |
|
|
$ |
1,339.2 |
|
|
$ |
— |
|
|
$ |
1,339.2 |
|
|
-10 |
% |
|
Operating Profit (Loss) |
|
(188.6 |
) |
|
|
325.4 |
|
|
|
136.8 |
|
|
|
219.1 |
|
|
|
21.9 |
|
|
|
241.0 |
|
|
-43 |
% |
|
Operating Margin |
|
-15.6 |
% |
|
|
26.9 |
% |
|
|
11.3 |
% |
|
|
16.4 |
% |
|
|
1.6 |
% |
|
|
18.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Segment Results |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Consumer Products: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
External Net Revenues (2) |
$ |
655.2 |
|
|
$ |
— |
|
|
$ |
655.2 |
|
|
$ |
734.2 |
|
|
$ |
— |
|
|
$ |
734.2 |
|
|
-11 |
% |
|
Operating Profit (Loss) |
|
11.4 |
|
|
|
10.8 |
|
|
|
22.2 |
|
|
|
(6.5 |
) |
|
|
9.6 |
|
|
|
3.1 |
|
|
>100 |
% |
|
Operating Margin |
|
1.7 |
% |
|
|
1.6 |
% |
|
|
3.4 |
% |
|
|
(0.9 |
)% |
|
|
1.3 |
% |
|
|
0.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Wizards of the Coast and Digital Gaming: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
External Net Revenues (3) |
$ |
375.6 |
|
|
$ |
— |
|
|
$ |
375.6 |
|
|
$ |
419.8 |
|
|
$ |
— |
|
|
$ |
419.8 |
|
|
-11 |
% |
|
Operating Profit |
|
142.3 |
|
|
|
— |
|
|
|
142.3 |
|
|
|
225.6 |
|
|
|
— |
|
|
|
225.6 |
|
|
-37 |
% |
|
Operating Margin |
|
37.9 |
% |
|
|
— |
|
|
|
37.9 |
% |
|
|
53.7 |
% |
|
|
— |
|
|
|
53.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Entertainment: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
External Net Revenues (4) |
$ |
179.2 |
|
|
$ |
— |
|
|
$ |
179.2 |
|
|
$ |
185.2 |
|
|
$ |
— |
|
|
$ |
185.2 |
|
|
-3 |
% |
|
Operating Profit (Loss) |
|
(324.2 |
) |
|
|
303.4 |
|
|
|
(20.8 |
) |
|
|
14.3 |
|
|
|
8.7 |
|
|
|
23.0 |
|
|
>-100 |
% |
|
Operating Margin |
>-100 |
% |
>100 |
% |
-11.6 |
% |
7.7 |
% |
4.7 |
% |
12.4 |
% |
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Corporate and Other: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Operating Profit (Loss) |
$ |
(18.1 |
) |
|
$ |
11.2 |
|
|
$ |
(6.9 |
) |
|
$ |
(14.3 |
) |
|
$ |
3.6 |
|
|
$ |
(10.7 |
) |
|
36 |
% |
|
(1) Effective in the first quarter of 2023, the Company realigned our brand portfolios to correspond with the Blueprint 2.0 strategy. Net Revenues by Brand Portfolio below have been restated to present net revenues and operating profit under the realigned structure. |
||||||||||||||||||||||||||
|
|
Net Revenues |
|
|
|
|
||||||
|
|
Quarter Ended |
|
|
|
|
||||||
|
|
July 2, 2023 |
|
June 26, 2022 |
|
% Change |
|
|||||
|
Net Revenues by Brand Portfolio |
|
|
|
|
|
|
|
|
|
|
|
|
Franchise Brands (a) |
$ |
788.4 |
|
$ |
826.0 |
|
-5 |
% |
|
||
|
Partner Brands |
|
172.9 |
|
|
|
219.4 |
|
|
-21 |
% |
|
|
Portfolio Brands |
|
107.1 |
|
|
|
135.8 |
|
|
-21 |
% |
|
|
Non-Hasbro Branded Film & TV |
|
141.6 |
|
|
|
158.0 |
|
|
-10 |
% |
|
|
Total |
$ |
1,210.0 |
|
|
$ |
1,339.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Franchise Brands include: DUNGEONS & DRAGONS, Hasbro Gaming, MAGIC: THE GATHERING, NERF, PEPPA PIG, PLAY-DOH and TRANSFORMERS. |
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Revenues |
|
|
|
|
||||||
|
|
Quarter Ended |
|
|
|
|
||||||
|
|
July 2, 2023 |
|
June 26, 2022 |
|
% Change |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MAGIC: THE GATHERING |
$ |
311.0 |
|
|
$ |
365.5 |
|
|
-15 |
% |
|
|
Hasbro Total Gaming (b) |
|
491.2 |
|
|
|
528.3 |
|
|
-7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(b) Hasbro Total Gaming includes all gaming revenue, most notably DUNGEONS & DRAGONS, MAGIC: THE GATHERING and Hasbro Gaming. |
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Revenues |
|
|
|
|
||||||
|
|
Quarter Ended |
|
|
|
|
||||||
|
|
July 2, 2023 |
|
June 26, 2022 |
|
% Change |
|
|||||
|
(2) Consumer Products Segment Net Revenues by Major Geographic Region |
|
|
|
|
|
|
|
|
|
|
|
|
North America |
$ |
382.0 |
|
|
$ |
433.3 |
|
|
-12 |
% |
|
|
Europe |
|
131.9 |
|
|
|
162.1 |
|
|
-19 |
% |
|
|
Asia Pacific |
|
66.4 |
|
|
|
66.6 |
|
|
0 |
% |
|
|
Latin America |
|
74.9 |
|
|
|
72.2 |
|
|
4 |
% |
|
|
Total |
$ |
655.2 |
|
|
$ |
734.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended |
|
|
|
|
||||||
|
|
July 2, 2023 |
|
June 26, 2022 |
|
% Change |
|
|||||
|
(3) Wizards of the Coast and Digital Gaming Net Revenues by Category |
|
|
|
|
|
|
|
|
|
|
|
|
Tabletop Gaming |
$ |
298.5 |
|
|
$ |
361.8 |
|
|
-17 |
% |
|
|
Digital and Licensed Gaming |
|
77.1 |
|
|
|
58.0 |
|
|
33 |
% |
|
|
Total |
$ |
375.6 |
|
|
$ |
419.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended |
|
|
|
|
||||||
|
|
July 2, 2023 |
|
June 26, 2022 |
|
% Change |
|
|||||
|
(4) Entertainment Segment Net Revenues by Category |
|
|
|
|
|
|
|
|
|
|
|
|
Film and TV |
$ |
153.3 |
|
|
$ |
148.2 |
|
|
3 |
% |
|
|
Family Brands |
|
25.9 |
|
|
|
22.8 |
|
|
14 |
% |
|
|
Music and Other |
|
— |
|
|
|
14.2 |
|
|
-100 |
% |
|
|
Total |
$ |
179.2 |
|
|
$ |
185.2 |
|
|
|
|
|
|
Operating Results |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
|
Six Months Ended July 2, 2023 |
|
Six Months Ended June 26, 2022 |
|
|
|||||||||||||||||||||
|
|
As Reported |
|
Non-GAAP Adjustments |
|
Adjusted |
|
As Reported |
|
Non-GAAP Adjustments |
|
Adjusted |
|
% Change |
|||||||||||||
|
Total Company Results |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
External Net Revenues (5) |
$ |
2,211.0 |
|
|
$ |
— |
|
|
$ |
2,211.0 |
|
|
$ |
2,502.3 |
|
|
$ |
— |
|
|
$ |
2,502.3 |
|
|
-12 |
% |
|
Operating Profit (Loss) |
|
(170.7 |
) |
|
|
354.7 |
|
|
|
184.0 |
|
|
|
339.1 |
|
|
|
43.7 |
|
|
|
382.8 |
|
|
-52 |
% |
|
Operating Margin |
|
(7.7 |
)% |
|
|
16.0 |
% |
|
|
8.3 |
% |
|
|
13.6 |
% |
|
|
1.7 |
% |
|
|
15.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Segment Results |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Consumer Products: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
External Net Revenues (6) |
$ |
1,175.6 |
|
|
$ |
— |
|
|
$ |
1,175.6 |
|
|
$ |
1,407.0 |
|
|
$ |
— |
|
|
$ |
1,407.0 |
|
|
-16 |
% |
|
Operating Profit (Loss) |
|
(34.6 |
) |
|
|
21.4 |
|
|
|
(13.2 |
) |
|
|
2.1 |
|
|
|
19.9 |
|
|
|
22.0 |
|
|
>-100 |
% |
|
Operating Margin |
|
(2.9 |
)% |
|
|
1.8 |
% |
|
|
(1.1 |
)% |
|
|
0.1 |
% |
|
|
1.4 |
% |
|
|
1.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Wizards of the Coast and Digital Gaming: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
External Net Revenues (7) |
$ |
670.8 |
|
|
$ |
— |
|
|
$ |
670.8 |
|
|
$ |
682.6 |
|
|
$ |
— |
|
|
$ |
682.6 |
|
|
-2 |
% |
|
Operating Profit |
|
219.1 |
|
|
|
— |
|
|
|
219.1 |
|
|
|
332.0 |
|
|
|
— |
|
|
|
332.0 |
|
|
-34 |
% |
|
Operating Margin |
|
32.7 |
% |
|
|
— |
|
|
|
32.7 |
% |
|
|
48.6 |
% |
|
|
— |
|
|
|
48.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Entertainment: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
External Net Revenues (8) |
$ |
364.6 |
|
|
$ |
— |
|
|
$ |
364.6 |
|
|
$ |
412.7 |
|
|
$ |
— |
|
|
$ |
412.7 |
|
|
-12 |
% |
|
Operating Profit (Loss) |
|
(332.9 |
) |
|
|
309.6 |
|
|
|
(23.3 |
) |
|
|
26.5 |
|
|
|
17.5 |
|
|
|
44.0 |
|
|
>-100 |
% |
|
Operating Margin |
|
-91.3 |
% |
|
|
84.9 |
% |
|
|
(6.4 |
)% |
|
|
6.4 |
% |
|
|
4.2 |
% |
|
|
10.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Corporate and Other: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Operating Profit (Loss) |
$ |
(22.3 |
) |
|
$ |
23.7 |
|
|
$ |
1.4 |
|
|
$ |
(21.5 |
) |
|
$ |
6.3 |
|
|
$ |
(15.2 |
) |
|
>100 |
% |
|
(5) Effective in the first quarter of 2023, the Company realigned our brand portfolios to correspond with the Blueprint 2.0 strategy. Net Revenues by Brand Portfolio below have been restated to present net revenues and operating profit under the realigned structure. |
||||||||||||||||||||||||||
|
|
Net Revenues |
|
|
|
|||||||
|
|
Six Months Ended |
|
|
|
|||||||
|
|
July 2, 2023 |
|
June 26, 2022 |
|
% Change |
|
|||||
|
Net Revenues by Brand Portfolio |
|
|
|
|
|
|
|||||
|
Franchise Brands (a) |
$ |
1,401.8 |
|
$ |
1,476.4 |
|
-5 |
% |
|
||
|
Partner Brands |
|
305.6 |
|
|
|
425.9 |
|
|
-28 |
% |
|
|
Portfolio Brands |
|
199.1 |
|
|
|
248.4 |
|
|
-20 |
% |
|
|
Non-Hasbro Branded Film & TV |
|
304.5 |
|
|
|
351.6 |
|
|
-13 |
% |
|
|
Total |
$ |
2,211.0 |
|
|
$ |
2,502.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
(a) Franchise Brands include: DUNGEONS & DRAGONS, Hasbro Gaming, MAGIC: THE GATHERING, NERF, PEPPA PIG, PLAY-DOH and TRANSFORMERS |
|||||||||||
|
|
|
|
|
|
|
|
|||||
|
|
Net Revenues |
|
|
|
|||||||
|
|
Six Months Ended |
|
|
|
|||||||
|
|
July 2, 2023 |
|
June 26, 2022 |
|
% Change |
|
|||||
|
|
|
|
|
|
|
|
|||||
|
MAGIC: THE GATHERING |
$ |
540.1 |
|
|
$ |
562.7 |
|
|
-4 |
% |
|
|
Hasbro Total Gaming (b) |
|
877.7 |
|
|
|
907.1 |
|
|
-3 |
% |
|
|
|
|
|
|
|
|
|
|||||
|
(b) Hasbro Total Gaming includes all gaming revenue, most notably DUNGEONS & DRAGONS, MAGIC: THE GATHERING and Hasbro Gaming. |
|||||||||||
|
|
|
|
|
|
|
|
|||||
|
|
Six Months Ended |
|
|
|
|||||||
|
|
July 2, 2023 |
|
June 26, 2022 |
|
% Change |
|
|||||
|
(6) Consumer Products Segment Net Revenues by Major Geographic Region |
|
|
|
|
|
|
|||||
|
North America |
$ |
661.1 |
|
|
$ |
838.5 |
|
|
-21 |
% |
|
|
Europe |
|
263.5 |
|
|
|
338.8 |
|
|
-22 |
% |
|
|
Asia Pacific |
|
129.7 |
|
|
|
118.8 |
|
|
9 |
% |
|
|
Latin America |
|
121.3 |
|
|
|
110.9 |
|
|
9 |
% |
|
|
Total |
$ |
1,175.6 |
|
|
$ |
1,407.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
Six Months Ended |
|
|
|
|||||||
|
|
July 2, 2023 |
|
June 26, 2022 |
|
% Change |
|
|||||
|
(7) Wizards of the Coast and Digital Gaming Net Revenues by Category |
|
|
|
|
|
|
|||||
|
Tabletop Gaming |
$ |
516.4 |
|
|
$ |
554.0 |
|
|
-7 |
% |
|
|
Digital and Licensed Gaming |
|
154.4 |
|
|
|
128.6 |
|
|
20 |
% |
|
|
Total |
$ |
670.8 |
|
|
$ |
682.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
Six Months Ended |
|
|
|
|||||||
|
|
July 2, 2023 |
|
June 26, 2022 |
|
% Change |
|
|||||
|
(8) Entertainment Segment Net Revenues by Category |
|
|
|
|
|
|
|||||
|
Film and TV |
$ |
321.7 |
|
|
$ |
338.4 |
|
|
-5 |
% |
|
|
Family Brands |
|
42.9 |
|
|
|
46.0 |
|
|
-7 |
% |
|
|
Music and Other |
|
— |
|
|
|
28.3 |
|
|
-100 |
% |
|
|
Total |
$ |
364.6 |
|
|
$ |
412.7 |
|
|
|
|
|
|
(9) Amounts within this section may not sum due to rounding |
|||||||||||
|
HASBRO, INC. |
|
|
|
|
|
|
|
||||||||
|
SUPPLEMENTAL FINANCIAL DATA |
|
|
|
|
|
|
|||||||||
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
|||||||||||||||
|
(Unaudited) |
|
|
|
|
|
|
|
||||||||
|
(Millions of Dollars) |
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
Reconciliation of EBITDA and Adjusted EBITDA (1) |
|
|
|
|
|
|
|
||||||||
|
|
Quarter Ended |
|
Six Months Ended |
||||||||||||
|
|
July 2, 2023 |
|
June 26, 2022 |
|
July 2, 2023 |
|
June 26, 2022 |
||||||||
|
Net Earnings (Loss) Attributable to Hasbro, Inc. |
$ |
(235.0 |
) |
|
$ |
142.0 |
|
|
$ |
(257.1 |
) |
|
$ |
203.2 |
|
|
Interest Expense |
|
46.6 |
|
|
|
41.7 |
|
|
|
92.9 |
|
|
|
83.3 |
|
|
Income Tax Expense |
|
7.0 |
|
|
|
39.4 |
|
|
|
7.7 |
|
|
|
56.7 |
|
|
Net Earnings (Loss) Attributable to Noncontrolling Interests |
|
0.1 |
|
|
|
(1.5 |
) |
|
|
0.5 |
|
|
|
0.2 |
|
|
Depreciation |
|
30.6 |
|
|
|
36.6 |
|
|
|
54.6 |
|
|
|
61.7 |
|
|
Amortization of Intangibles |
|
22.8 |
|
|
|
27.2 |
|
|
|
45.9 |
|
|
|
54.3 |
|
|
EBITDA |
$ |
(127.9 |
) |
|
$ |
285.4 |
|
|
$ |
(55.5 |
) |
|
$ |
459.4 |
|
|
Non-GAAP Adjustments and Stock Compensation (2) |
|
326.5 |
|
|
|
22.9 |
|
|
|
352.8 |
|
|
|
41.0 |
|
|
Adjusted EBITDA |
$ |
198.6 |
|
|
$ |
308.3 |
|
|
$ |
297.3 |
|
|
$ |
500.4 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
(2) Non-GAAP Adjustments and Stock Compensation are comprised of the following: |
|
|
|
|
|
|
|
||||||||
|
Stock compensation |
$ |
19.2 |
|
|
$ |
22.9 |
|
|
$ |
34.9 |
|
|
$ |
41.0 |
|
|
Operational Excellence charges |
|
10.4 |
|
|
|
— |
|
|
|
21.0 |
|
|
|
— |
|
|
Blueprint 2.0 implementation charges |
|
0.7 |
|
|
|
— |
|
|
|
0.7 |
|
|
|
— |
|
|
Impairment of Goodwill and Intangible Assets |
|
296.2 |
|
|
|
— |
|
|
|
296.2 |
|
|
|
— |
|
|
Total |
$ |
326.5 |
|
|
$ |
22.9 |
|
|
$ |
352.8 |
|
|
$ |
41.0 |
|
|
(1) Amounts may not sum due to rounding |
|||||||||||||||
|
HASBRO, INC. |
|
|
|
|
|
|
|
||||||||
|
SUPPLEMENTAL FINANCIAL DATA |
|||||||||||||||
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
|||||||||||||||
|
(Unaudited) |
|
|
|
|
|
|
|
||||||||
|
(Millions of Dollars) |
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
Reconciliation of Adjusted Operating Profit (1) |
|
|
|
|
|||||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
Quarter Ended |
|
Six Months Ended |
||||||||||||
|
|
July 2, 2023 |
|
June 26, 2022 |
|
July 2, 2023 |
|
June 26, 2022 |
||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
Operating Profit (Loss) |
$ |
(188.6 |
) |
|
$ |
219.1 |
|
|
$ |
(170.7 |
) |
|
$ |
339.1 |
|
|
Consumer Products |
|
11.4 |
|
|
|
(6.5 |
) |
|
|
(34.6 |
) |
|
|
2.1 |
|
|
Wizards of the Coast and Digital Gaming |
|
142.3 |
|
|
|
225.6 |
|
|
|
219.1 |
|
|
|
332.0 |
|
|
Entertainment |
|
(324.2 |
) |
|
|
14.3 |
|
|
|
(332.9 |
) |
|
|
26.5 |
|
|
Corporate and Other |
|
(18.1 |
) |
|
|
(14.3 |
) |
|
|
(22.3 |
) |
|
|
(21.5 |
) |
|
|
|
|
|
|
|
|
|
||||||||
|
Non-GAAP Adjustments (2) |
$ |
325.4 |
|
|
$ |
21.9 |
|
|
$ |
354.7 |
|
|
$ |
43.7 |
|
|
Consumer Products |
|
10.8 |
|
|
|
9.6 |
|
|
|
21.4 |
|
|
|
19.9 |
|
|
Entertainment |
|
303.4 |
|
|
|
8.7 |
|
|
|
309.6 |
|
|
|
17.5 |
|
|
Corporate and Other |
|
11.2 |
|
|
|
3.6 |
|
|
|
23.7 |
|
|
|
6.3 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Adjusted Operating Profit (Loss) |
$ |
136.8 |
|
|
$ |
241.0 |
|
|
$ |
184.0 |
|
|
$ |
382.8 |
|
|
Consumer Products |
|
22.2 |
|
|
|
3.1 |
|
|
|
(13.2 |
) |
|
|
22.0 |
|
|
Wizards of the Coast and Digital Gaming |
|
142.3 |
|
|
|
225.6 |
|
|
|
219.1 |
|
|
|
332.0 |
|
|
Entertainment |
|
(20.8 |
) |
|
|
23.0 |
|
|
|
(23.3 |
) |
|
|
44.0 |
|
|
Corporate and Other |
|
(6.9 |
) |
|
|
(10.7 |
) |
|
|
1.4 |
|
|
|
(15.2 |
) |
|
|
|
|
|
|
|
|
|
||||||||
|
(2) Non-GAAP Adjustments include the following: |
|
|
|
|
|
|
|
||||||||
|
Acquisition-related costs (i) |
$ |
— |
|
|
$ |
3.6 |
|
|
$ |
1.9 |
|
|
$ |
6.3 |
|
|
Acquired intangible amortization (ii) |
|
18.1 |
|
|
|
18.3 |
|
|
|
34.9 |
|
|
|
37.4 |
|
|
Operational Excellence charges (iii) |
|
|
|
|
|
|
|
||||||||
|
Transformation office and consultant fees |
|
10.4 |
|
|
|
— |
|
|
|
21.0 |
|
|
|
— |
|
|
Blueprint 2.0 implementation charges (iv) |
|
|
|
|
|
|
|
||||||||
|
eOne TV and Film business sale process charges (a) |
|
0.7 |
|
|
|
— |
|
|
|
0.7 |
|
|
|
— |
|
|
Impairment of Goodwill and Intangible Assets (v) |
|
296.2 |
|
|
|
— |
|
|
|
296.2 |
|
|
|
— |
|
|
Total |
$ |
325.4 |
|
|
$ |
21.9 |
|
|
$ |
354.7 |
|
|
$ |
43.7 |
|
(i) In association with the Company’s acquisition of eOne, the Company incurred stock compensation expenses of $1.9 ($1.7 after-tax) in the six months ended July 2, 2023, and $3.6 ($3.2 after-tax) and $6.3 ($5.6 after-tax) in the quarter and six months ended June 26, 2022. The expense is included within Selling, Distribution and Administration.
(ii) Represents intangible amortization costs related to the intangible assets acquired in the eOne acquisition. The Company has allocated certain of these intangible amortization costs between the Consumer Products and Entertainment segments, to match the revenue generated from such intangible assets. While amortization of acquired intangibles is being excluded from the related GAAP financial measure, the revenue of the acquired company is reflected within the Company’s operating results to which these assets contribute.
(iii) Program related consultant and transformation office fees of $10.4 ($8.0 after tax) and $21.0 ( ($16.1 after-tax) for the quarter and six months ended July 2, 2023, are included within Selling, Distribution and Administration within the Corporate and Other segment. These costs relate to the comprehensive review of the Company’s operations and development of a transformation plan to support the organization in identifying, realizing and capturing savings to create efficiencies and improve business processes and operations.
(iv) The Company announced the results of its strategic review, Blueprint 2.0, a consumer-centric approach focusing on fewer, bigger brands, expanded licensing, branded entertainment, and high-margin growth in games, digital and direct. Charges recognized in Selling, Distribution and Administration, as the Company implements the new strategy are $0.7 ($0.5 after tax) for the quarter and six months ended July 2, 2023, consisting of:
(a) eOne TV and Film business sale process charges of $0.7 ($0.5 after-tax) for the quarter and six months ended July 2, 2023, as a result of the sale process for the part of its eOne TV and film business not directly supporting the Company’s Branded Entertainment Strategy.
(v) Non-cash Goodwill and Asset impairment charges of $296.2 ($279.9 after tax) for quarter and six months ended July 2, 2023 incurred within the Entertainment segment, of which $231.2 related to the goodwill impairment of Film & TV due to the expected economic impact of industry factors and $65.0 related to an impairment of the Company’s definite-lived intangible, eOne Trademark, which is included in Selling, Distribution and Administration.
|
(1) Amounts may not sum due to rounding |
|
HASBRO, INC. |
|
|
|
|
|
|
|||||||||
|
SUPPLEMENTAL FINANCIAL DATA |
|
|
|
|
|||||||||||
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
|
|
|
|
|||||||||||
|
(Unaudited) |
|
|
|
|
|
|
|
||||||||
|
(Millions of Dollars and Shares, Except Per Share Data) |
|
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
Reconciliation of Net Earnings and Earnings per Share (1) |
|||||||||||||||
|
|
Quarter Ended |
||||||||||||||
|
(all adjustments reported after-tax) |
July 2, 2023 |
|
Diluted Per Share Amount |
|
June 26, 2022 |
|
Diluted Per Share Amount |
||||||||
|
Net Earnings (Loss) Attributable to Hasbro, Inc. |
$ |
(235.0 |
) |
|
$ |
(1.69 |
) |
|
$ |
142.0 |
|
$ |
1.02 |
||
|
Acquisition and related costs |
|
— |
|
|
|
— |
|
|
|
3.3 |
|
|
|
0.02 |
|
|
Acquired intangible amortization |
|
14.3 |
|
|
|
0.10 |
|
|
|
15.3 |
|
|
|
0.11 |
|
|
Operational Excellence charges |
|
8.0 |
|
|
|
0.06 |
|
|
|
— |
|
|
|
— |
|
|
Blueprint 2.0 implementation charges |
|
0.5 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Impairment of Goodwill and Intangible Assets |
|
279.9 |
|
|
|
2.01 |
|
|
|
— |
|
|
|
— |
|
|
Net Earnings Attributable to Hasbro, Inc., as Adjusted |
$ |
67.7 |
|
|
$ |
0.49 |
|
|
$ |
160.6 |
|
|
$ |
1.15 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Six Months Ended |
||||||||||||||
|
(all adjustments reported after-tax) |
July 2, 2023 |
|
Diluted Per Share Amount |
|
June 26, 2022 |
|
Diluted Per Share Amount |
||||||||
|
Net Earnings (Loss) Attributable to Hasbro, Inc. |
$ |
(257.1 |
) |
|
$ |
(1.85 |
) |
|
$ |
203.2 |
|
|
$ |
1.46 |
|
|
Acquisition and related costs |
|
1.7 |
|
|
|
0.01 |
|
|
|
5.6 |
|
|
|
0.04 |
|
|
Acquired intangible amortization |
|
27.6 |
|
|
|
0.20 |
|
|
|
31.2 |
|
|
|
0.22 |
|
|
Operational Excellence charges |
|
16.1 |
|
|
|
0.12 |
|
|
|
— |
|
|
|
— |
|
|
Blueprint 2.0 implementation charges |
|
0.5 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Impairment of Goodwill and Intangible Assets |
|
279.9 |
|
|
|
2.02 |
|
|
|
— |
|
|
|
— |
|
|
Net Earnings Attributable to Hasbro, Inc., as Adjusted |
$ |
68.7 |
|
|
$ |
0.49 |
|
|
$ |
240.0 |
|
|
$ |
||
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