On Monday, Hasbro announced is earnings for the fourth quarter and the full year for 2015. Overall, net revenues were up 13% in Q4 and would’ve been up 23% absent a negative foreign exchange impact of $128.1 million in the quarter. Revenues were largely buoyed by tie-ins from Star Wars and Jurassic World as well as Disney Descendants and Sesame Street. Franchise brands declined by 3%, but would’ve been up 6% absent FX. Revenues were up for Nerf, Play-Doh, and Magic: The Gathering.
For the year as a whole, revenues reach $4.4 billion which was an increase of 4% (up 13% absent a negative FX impact of $394.5 million). Franchise brands decline 2% for the year, but would’ve been up 7% absent FX. Monopoly joined Nerf, Play-Doh, and Magic: The Gathering on the up side. My Little Pony would join that group absent FX. Operating profit for the year was up 9%.
Declines in the Girls’ department were 17% in Q4 and 22% for the year. Those declines continue to be spelled F-u-r-b-y for the most part. Core revenues for My Little Pony increased for the year, but were offset by declines for “Equestria Girls.” However, the arrival of tie-ins for both Disney Princess and Frozen should provide some tailwind in 2016.
Boys was up 35% for Q4 and 20% for the year again buoyed by Star Wars, Jurassic World, and Marvel, which more than offset anticipated declines with Transformers (i.e. no movie). Littlest Pet Shop experienced a “small revenue decrease” according to Hasbro CEO Brian Goldner, though he sees an opportunity with a new “immersive franchise story” that they will be unveiling in the future.
Further to a point on MLP, Mr. Goldner says that is remains a “vibrant and growing property” that has established itself as a “major lifestyle brand”.
“My Little Pony remains a vibrant and growing property, said Mr. Goldner as transcribed by Seeking Alpha. “The core My Little Pony brand did extremely well in 2015 with positive revenue growth in several countries backed by strong point-of-sale and the launch of the new Friendship is Magic collectable segment. My Little Pony has established itself as a major lifestyle brand, and for 2015 was our top license property.
“We experience a slowdown in “Equestria Girls” that offset much of the growth we saw in other areas of the brand. In January 2016, we launched a new Mini Dolls! “Equestria Girls” line which is off to a very good start.
“Overall, My Little Pony brand engagement is very high across all lines of the business. To maintain this momentum, we are continuing to invest in multichannel storytelling, while evolving our entertainment strategy to more effectively delivery content. The success of our franchise brands contributed to the 11% revenue growth in our entertainment and licensing segment. Despite a difficult comparison with the 2014 Transformers movie, consumer product licensing revenues increased.”
The next major presentation from Hasbro will be on Friday at Toy Fair NYC at 8am Eastern Time.
THOUGHTS: It was always going to be a bit of an ask for MLP to match or exceed what was a record year in 2014—especially given the FX impact of the past few quarters. Still, rumors and charges that the franchise may be in something of a decline are greatly exaggerated. It remains mostly a mystery what 2016 will bring for MLP apart from a new foal for Princess Cadance and Shining Armor and that the theme is to “Explore Equestria” (at least by swan boat). A major part of those questions may be answered on Friday.