Hasbro has seen its second quarter net revenues drop seven per cent, citing the liquidation of Toys R Us in the US and global market the biggest contributing factor.
The toymaker has seen net revenue for the quarter drop to $904.5 million from the $972.5 million in the same quarter of last year. Revenues declined most notably in Europe as a result of managing retail inventory.
Net earnings for Hasbro hit $60.3 million for the second quarter of 2018, compared to $67.7 million for the second quarter of 2017.
The company has said that the drop is in line with expectations following the fall out of the Toys R Us liquidation.
Brian Goldner, Hasbro’s chairman and CEO, said: “We are investing in our business – in innovation, entertainment and a modern global commercial organisation, to drive profitable growth in 2019 and beyond.
“Consumer takeaway is up for our brands, and we further strengthened our brand portfolio through the acquisition of Power Rangers. We are focused on moving beyond the near-term disruption of losing a major customer, with a clear path forward including new retailer activations to meet the consumer demand made available by the toys R Us departure.”
Deborah Thomas, Hasbro’s chief financial officer, added: “Our global teams executed well despite the disruption in the market. With $1.2 billion in cash and a healthy balance sheet, our financial position is strong. Our diverse portfolio enabled us to partially offset the negative margin impact from lower revenues, but not entirely.
“We are working with retailers to successfully execute their plans for Hasbro’s innovative portfolio this holiday season.”
Despite the net revenue fall, entertainment and licensing segment net revenues increased 26 per cent to $64.7 million compared to $51.5 million in 2017.