Hasbro HAS: Q2 2020 results fall short, stocks fall

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Store closures, product shortages and declining retail inventories hampered Hasbro in its fiscal second quarter, as the company grappled with the fallout from the global coronavirus pandemic.Despite strong demand for toys in the quarter, Hasbro’s revenue fell 29% on a pro forma basis.

Shares of the company were down about 11% in pre-market trading on Monday, due to weaker-than-expected results.

For the quarter ended June 28, Hasbro reported a net loss of $ 33.9 million, or 25 cents per share, compared with earnings of $ 13.4 million, or 11 cents per share, a year ago .

Excluding items, Hasbro 2 cents per share. Analysts polled by Refinitiv had expected Hasbro to earn 23 cents a share.

Revenue fell to $ 860.2 million, which was below the $ 922 million expected by analysts.

Almost 30% of its global toys and games revenue comes from online sales.

The company’s gaming portfolio remained strong in the quarter, with category revenue up 11%, fueled by sales of Jenga, Connect 4, Mouse Trap and Twister. However, Hasbro’s supply chain disruption resulted in low inventory levels and limited its number of shipments during the quarter.

Hasbro said shipments and sales improved as stores began to reopen at the end of the quarter. He said this trend continued in July.

“We think the outlook improves from here,” Hasbro CEO Brian Goldner said in a statement. “… We expect the environment to improve in the third quarter and prepare us to run a good holiday season. ”

Hasbro, which works with big studios, has also been hit by the closure of movie theaters and the lack of new blockbuster features released to the big screen. Goldner noted that the company has a solid entertainment lineup for 2021 with partnerships and for its own movie roster.

While live television and film production has been hampered by the pandemic, animation production has continued for brands like Peppa Pig, PJ Masks and Hasbro’s upcoming feature “My Little Pony”.

Sales of action figures in the toy industry have been slow due to the backlog of films. Hasbro holds the primary license for the toy for Marvel and Star Wars. Still, Hasbro said sales remained strong for its “Frozen 2” and “Star Wars” collections.

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