Tag: inside the numbers

Inside the Numbers: Hasbro’s Q3 Earnings

Whatever way you look at the box office receipts from My Little Pony:  The Movie, one metric in which Hasbro does measure the success of the movie is in toy sales. On that end, it is doing its job. MLP broke its quarterly losing streak in the 3rd quarter as it was listed as one of the franchise brands leading Hasbro’s growth in the quarter alongside Nerf, Transformers, and Monopoly. Franchise Brands increased 7% as a whole while Gaming (which also included Monopoly) rose 22%. Emerging Brands were up 9% led by gains in Furreal Friends and Baby Alive. Partner Brands declined by 2% as gains in Star Wars, Sesame Street, Beyblade, and Disney Descendants were offset by declines in Yokai Watch and Dreamworks’ Trolls.

Hasbro as a whole grew revenues by 7% while operating profit was relatively flat and was negatively impacted by the recent bankruptcy filing of Toys R Us. Hasbro is reported to receive 9% of its revenue from sales at Toys R U and is exposed to $60 million of the toy retailer’s $5 billion debt in terms of unsecured claims for payment.

“My Little Pony revenue increased behind the release of MY LITTLE PONY: THE MOVIE and successfully drove point-of-sale gains around the movie debut,” said Hasbro CEO Brian Goldner as transcribed by Seeking Alpha. “Our content to commerce model delivers multiple revenue streams, including entertainment and merchandise and we are well positioned in our investment.

“The film was successful in reinvigorating and energizing our core consumer base and our fan base, while inviting new fans into the brand. The film is yet to be released in a number of international markets and will be followed by the Home Entertainment window, an important element of expanding the audience.”

Goldner also shared that the movie was made on “modest budget” and that Lionsgate pre-sells the film in “substantial part of the global marketplace” and self-distribute in the UK and most of Latin America.

“The rest of the markets they are pre-selling, so you get that recoupment right up front around your production expense,” Goldner continued. “The movie itself, if you take it through the waterfall should be a contributor to the company over time. Obviously, it may not occur in the — by the fourth quarter this year, because obviously our expenses for producing the movie will hit in the fourth quarter this year, but again, remember it’s a modest budget. However, all the streams of income that it’s creating, including consumer products are toys and games business. The digital game that’s performing at a very high-level from Budge Studios and new games that are coming we think it’s a great model for the brand. And of course we continue with the 7th season of the television that’s appearing globally on linear television services as well as in stream services, it’s a very strong performer on Netflix and other services. We see this as a very good model for us go forward.”

Goldner still has belief in the model for MLP going into 2018 and thinks “the team is beginning to think about what our next movie might look like” and that brand will continue to halo strongly. Goldner also stated in the earnings call that revenues for MLP year-to-date are also now on the plus side.

Because of the Toys R Us bankruptcy, Hasbro expects more modest growth in the fourth quarter. However, they also expect MLP to be a big player in the months ahead as MLP heads to video in the near future and the show enters its eighth season in 2018. We are not certain as to interpret Mr. Goldner’s comments about what the ’next movie’ he mentioned will be a new MLP Movie, though fans wouldn’t mind that in the slightest. He feels that there was enough to reinvigorate the core consumer base and fan base, so we’ll see what happens over the next couple of quarters.

StatManDan

Inside the Numbers: Hasbro’s Q2 Earnings

It was another strong quarter for Hasbro, though not a strong enough quarter in the eyes of some investors. As a result, Hasbro’s stock price (NASDAQ:  HAS) fell $11.01 a share to $104.94/share. Hasbro’s stock had been at or near a record high the last few days.

Franchise brands were up 21% in Q2 with the growth coming from TransformersMagic: The GatheringNerf (consistent performer), and Monopoly. The hurt came from the Partner brands (i.e. Star Wars, Disney Princess, Trolls, etc). which was up just 1% and Emerging brands down 14%.

When it comes to MLP, Hasbro CEO Brian Goldner said it was “off just a bit for the quarter,” but remains highly optimistic that things will pick up considerable as the movie approaches in October. The official launch of merchandise is after Friendship Day on Sunday, July 30th, though Movie merchandise is already hitting stores such as Target and Wal-Mart as well as online where sales are very strong.

“The My Little Pony franchise is well positioned for the October 6 of My Little Pony: The Movie,” said Goldner as transcribed by Seeking Alpha.  “Consumer engagement with the franchise remains high and global retailers are providing cross category support for our innovative new line and expensive consumer products program.”

That may not be truly evident until the fourth quarter as it was noted that consumer products royalties from brands such as MLP and Transformers comes in the quarter after the sales occur. Meaning merchandise sold in August for example. may not be reflected until the fourth quarter presentation.

This is concurrent with the restart of Season Seven and all of the MLP action going on at Hascon in September. So everything looks to be towards the second half of the year for MLP and what a second half it will be.

StatManDan

Inside the Numbers: Hasbro’s 2017 Q1 Earnings

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Digital gaming spearheaded Hasbro’s 2017 Q1 earnings as the company reported yet another successful quarter. Revenues were up 2% from this time last year. Franchise brands (My Little Pony, Transformers, Monopoly, Nerf, Magic:  The Gathering, Play-Doh, and Littlest Pet Shop) were up 2% led by gains from Transformers, Monopoly, and Nerf. MLP did decline for the quarter, but Hasbro CEO said that brand engagement continues to be ‘high’ as they prepare for an August 1st shelf date for tie-ins to the upcoming movie.

Partner brands did decline 18%, but that was expected as there are Star Wars and Marvel movies coming up later this year. Sales in both those parter brands more than offset games from DreamWorks’ Trolls and Beyblade. Gaming, as mentioned, was up 43% from last quarter (+10% if you throw in Monopoly and Magic: The Gathering). Emerging brands went up 25% for the quarter compared to last year.

Operating profits declined 9% due to an extra week of expenses in the quarter and a shift in the product mix.

Also of note was that this is the first time since 2000 where Hasbro’s quarterly revenue was better than that of Mattel’s who had another rough quarter.

Hasbro looks only set to build on this with the upcoming slate of films such as Transformers: The Last Knight, My Little Pony: The Movie, Star Wars: The Last Jedi, and numerous Marvel movies. We’ll see if MLP will start to grow against after difficult comparison to the highs of 2014 and 2015. Gaming was a pleasant surprise as people are seemingly rediscovering Monopoly and enjoying the plethora of digital gaming options thanks to Hasbro’s Backflip Studios.

StatManDan

Inside the Numbers: Hasbro’s 2016 Q4 Earnings

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Hasbro continues to be buoyed by Partner Brands such as Star Wars, Disney Princess, Disney’s Frozen, and DreamWorks’ Trolls. Hasbro was up 11% in Q4 compared to this time last year while revenues were up 13% for the year and topped $5 billion for the first time in company history.

Nerf continued its winning streak in Q4 and the year as a whole among franchise brands. Transformers experienced ‘double-digit growth’ in the second half the year according to Hasbro CEO Brian Goldner and is set up nicely for their next movie coming out in June. For the quarter, Transformers, Nerf, and Monopoly grew. For the year as a whole, it was Nerf, Play-Doh, and Magic: The Gathering.

As for My Little Pony, it was down for the year domestically, but up internationally.

My Little Pony revenues declined last year, but grew in the International segment,” said Goldner in the Earnings Conference Call as transcribed by Seeking Alpha. Brand engagement continues to build through multi-screen storytelling, and we have an innovative and robust line with new characters and worlds. Retailers and consumer products licensees are significantly supporting both [Transformers and MLP] films. The MLP movie comes out in October.

We are going to know a lot more about MLP around February 18th when Toy Fair NYC begins. It has been a main source for upcoming MLP projects in the past and with the movie and Season 7 coming up, things should be no different. This year was a bit of an off year for the MLP franchise, but Hasbro is expected to pick things up with the ponies this year.

StatManDan

Inside the Numbers: Hasbro’s Q3 Earnings

On Monday, Hasbro announced their earnings for the third quarter of 2016 and it was the highest revenue and earnings quarter in the history of the companyNet revenues are at $1.68 billion, up 14% from this time last year. Net earnings reached $257.8 million compared to $207.6 million last year.

Like the last pair of quarters, revenues and earnings were buoyed by Star WarsDisney Princess, and Disney’s Frozen toy lines. Expect the former to continue to grow with Star Wars:  Rogue One coming out this December.

Franchise brands grew 2% with gains for Transformers, Magic: the Gathering, Nerf (for the 15th straight quarter), and Play-Doh (which grew for the 20th straight quarter). My Little Pony was not among the gainers, though emphasis continues to be placed towards the 2017 movie in addition to the new mobile app game “My Little Pony:  Puzzle Party” that was released last week.

“The My Little Pony franchise continued to drive brand awareness through the strategic use of entertainment, pop culture events and consumer products expansion,” said Hasbro CEO Brian Goldner as transcribed by Seeking Alpha. “In a very competitive small doll segment, our holiday items and new launches are beginning to drive POS gains in many markets around the world. In 2017, the My Little Pony movie will bring global audiences to all new worlds, with both the core cast of characters, along with all new characters.”

Again, it appears MLP is still in a bit of a transitional period as the movie approaches as well as a seventh season. Puzzle Party promises to be addictive (and costly if you want to get to level 143) while the Gameloft game is still a top 100 adventure game app. If we’re being honest, this has been a bit of a low-key year which was bound to happen. However, things might just pick up again with a 2017 movie and a 7th season.

StatManDan

Inside the Numbers: Hasbro’s 2016 Q2 Earnings

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Hasbro continued to be spearheaded by its licensing deals with Star Wars and Disney Princess an Disney Frozen. Revenues overall grew 10% for the second quarter and operating profit grew 12%. The Boys segment was up 4% led by double-digit growth in Nerf, but there were issues with declines for Transformers and Jurassic World which cause a near $6 decline in the company’s stock today. Games was up 8% led by Pie-Face , Duel Masters, and Yahtzee. Preschool was up 5% and led by double-digit growth in Play-Doh. Girls was up 35% and led by Disney Princess and Disney Frozen.

MLP was hardly mentioned in the earnings call which went under 50 minutes. Hasbro CEO Brian Goldner said on the conference call that while revenues for MLP were slightly off in the quarter, there are things to look forward to in the second half of the year and leading up to the 2017 movie.

“MY LITTLE PONY declined slightly in the quarter as we transition elements of our toy line,” said Goldner. “Over the past five years, content and innovation has propelled this brand in both games and toys and consumer products.

“MY LITTLE PONY FRIENDSHIP IS MAGIC season six is currently airing around the world and our fall product line features the core cast inspired by the locations they visit. MY LITTLE PONY EQUESTRIA GIRLS mini dolls have performed very well, exceeding our expectations, and are helping offset difficult comparisons to a year ago.

“This leads us to next year, when on October 6, 2017, MY LITTLE PONY: THE MOVIE will hit theatres with an all-star cast and global distribution from Lionsgate. The film introduces new characters, new worlds and new play experiences for the MY LITTLE PONY fan.”

A lot of what Hasbro is doing is indeed back-ended and that back end starts with San Diego Comic Con starting Thursday. There are a pair ofTransformers initiatives coming up this year and there’s a 2017 movie. Of course, revenues for Transformers usually face headwinds when there isn’t a movie and we’re currently two years removed from one.

Back to MLP, there is “Legends of Everfree” this Fall and the second half of Season Six starting on July 30th and the first half coming to Netflix the same day. So while this was, given its recent past, and off quarter, there is still plenty to look forward to with an emphasis on the 2017 movie.

StatManDan

Inside the Numbers: Hasbro’s 2016 Q1 Earnings

Not surprisingly, Star Wars, Disney’s Frozen, and Disney Princesses led the way for Hasbro as they reported a 16% increase in revenue over this time last year. Revenues in the Boys segment were up 24% and up 41% in the Girls segment. In the case of the latter, that ends a five-quarter skid for the Girls segment as a whole.

The Franchise Brands (Littlest Pet Shop, Monopoly, My Little Pony, Magic: The Gathering, Play-Doh, Nerf, and Transformers) were up 9% in terms of actual sales of toys and games and 1% (+4% absent foreign exchange) in terms of overall revenue. The drawback was that Entertainment and Licensing revenue dropped 30% as last year’s quarter included revenue from a digital streaming deal that included Transformers, LPS, and MLP. Both Nerf and Play-Doh record double-digit gains in revenue while Transformers was again in “difficult comparison” territory as last year, that franchise was coming off a movie.

As far as MLP goes, according to Hasbro CEO Brian Goldner—as transcribed by Seeking Alpha—MLP grew in the US and Canada segment and absent FX in the international segment.

“We continue to deliver innovative new product, strong licensing programs and compelling entertainment, including the sixth season of My Little Pony Friendship is Magic, which began airing March 26th,” said Goldner.

“In addition, the launch of the new Equestria Girls Mini Dolls! segment is off to a strong start. We are working through some retail inventory within Equestria Girls  but we are optimistic about the initial consumer reaction to our new offering and the overall outlook for My Little Pony globally.”

Asked about how he views the MLP brand going forward during the earnings call, Mr. Goldner, said that the company has very robust plans over this and next year.

My Little Pony‘s next season is just launching now and rolling out around the world, it’s the sixth season for the brand. And the theme this year is all about exploring Equestria and it ties together with lots of the initiatives that we have across the Company. We have very robust plans in multi categories for My Little Pony throughout this year, brand new toys and games products but also I’ve seen some really wonderful product in our consumer products licensing business and apparel that’s out internationally in the UK, very strong results in several categories of products setting all around the world in tune with that theme and that will roll into 2017. And then as you know for fall of 2017 November, we have our first animated feature film that will be distributed by Lionsgate in the My Little Pony movie.

So, we’ll have television entertainment, streaming entertainment across a number of different over the top providers. Kids can find entertainment, both short form and long form. And then they can also find entertainment on digital games with some new digital games that we’ll launch including one new My Little Pony digital game launching from BlackFoot studios; we continue to have a game from Gameloft throughout the year so story telling across a number of different dimensions and continue to feel very good about the brand. And as I’ve mentioned, the new Equestria Girls line and launch is and going off quite well with the new Mini Dolls! segment.”

Goldner also mentioned that MLP’s 12% increase in sales is for both the core brand and for Equestria Girls.

As with last year, there should be plenty to do with MLP in the next three quarters and into 2017. By all indications, it is still full steam ahead with My Little Pony. 

StatManDan