Hasbro revenue slips on production delays in movies, TV shows, shares fall
(Reuters) - Hasbro Inc reported a 4% fall in adjusted revenue on Monday as coronavirus-led delays in the production of movies and TV shows hit its entertainment unit, taking the shine off its thriving board game business and sending its shares down 10%. The fall in the company's overall third-quarter net revenue, excluding the acquisition of 'Peppa Pig' maker Entertainment One, came in contrast with rival Mattel, which last week posted net sales growth of nearly 10% for the same period.
(Reuters) - Hasbro Inc reported a 4% fall in adjusted revenue on Monday as coronavirus -led delays in the production of movies and TV shows hit its entertainment unit, taking the shine off its thriving board game business and sending its shares down 10%.
The fall in the company's overall third-quarter net revenue, excluding the acquisition of "Peppa Pig" maker Entertainment One, came in contrast with rival Mattel, which last week posted net sales growth of nearly 10% for the same period.
Hasbro has been trying to broaden its revenue base by making movies, TV shows and video games based on characters it owns, but the coronavirus crisis has highlighted the risk of that bet as studios are forced to delay projects by months.
Revenue from that side of Hasbro's business fell 28% in the third quarter.
Analysts at MKM Partners attributed some of the drop in Hasbro's shares on Monday to heightened expectations after Mattel handily trounced sales and profit forecasts on the back of strong demand for its Barbie line of dolls.
Hasbro reported third-quarter net revenue of $1.78 billion, beating analysts' estimates of $1.75 billion, according to IBES data from Refinitiv.
However, Mattel, which is still almost entirely reliant on traditional toy sales, beat estimates by nearly $200 million, while closing the revenue gap on its larger rival.
Still, total revenue from all of Hasbro's gaming brands including Monopoly, Scrabble and Dungeons & Dragons jumped 21% as stuck-at-home families spent more on board games.
Hasbro said its adjusted earnings could rise in the fourth quarter, but warned the lack of a blockbuster kids' movie during the holiday season could pressure some toy sales.
Third-quarter net earnings attributable to the company rose 3.7% to $220.9 million. On an adjusted basis, Hasbro posted earnings of $1.88 per share, beating estimates of $1.63.
(Reporting by Uday Sampath in Bengaluru; Editing by Anil D'Silva)
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