(By Balachander) Hasbro Inc. (NASDAQ: HAS) reported better-than-expected quarterly earnings and the toy maker still forecasts growth for the full year, excluding the impact of foreign exchange. However, revenue fell and missed Wall Street projections on top-line decreases at two of its segments.
Excluding the impact of foreign exchange translation, the Pawtucket, Rhode Island-based company earned $1.28 per share, topping market expectations of $1.20. Revenue grew 1 percent to $1.39 billion, versus consensus estimates of $1.38 billion.
Net earnings fell 3.6 percent to $164.9 million. Revenue declined 2.2 percent to $1.35 billion for the third quarter.
U.S. and Canada segment net revenue advanced 1 percent as growth in the Girls and Games categories was partially offset by decreases in the Boys and Preschool categories. Decreases in the company's Transformers and Beyblade products negativelt impacted the Boys category.
International revenue dropped 7 percent in amid a fall in Europe and Asia Pacific. Meanwhile, Entertainment and Licensing segment revenue fell 7 percent, hit by a fall in movie-related revenue.
Operating margin at Hasbro's U.S. and Canada segment improved to 19.9 percent from 16.8 percent, while International segment operating margin shrank to 16.3 percent from 17.9 percent.
"We are entering the holiday season with exciting, innovative products, including some of the hottest toys in the market and a tremendously successful MARVEL line," commented CFO Deborah Thomas. "In the all important fourth quarter, we plan to drive these and other initiatives with a significant increase in marketing support in an environment of significantly lower U.S. retail inventory."
As a result, the company continues to believe, absent the impact of foreign exchange, Hasbro will again grow revenues and earnings per share for 2012.
HAS shares, which have been trading between $31.51 and $39.98 over the past year, closed Friday's regular trading at $39.05.