SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES AND EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported): July 16, 1998
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HASBRO, INC.
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(Name of Registrant)
RHODE ISLAND 1-6682 05-0155090
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(State of (Commission (IRS Employer
Incorporation) File Number) Identification No.)
1027 NEWPORT AVE., PAWTUCKET, RHODE ISLAND 02861
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(Address of Principal Executive Offices) (Zip Code)
(401) 431-8697
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(Registrant's Telephone Number)
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Item 5. Other Events
The July 16, 1998 Press Release of the Registrant attached
hereto as EXHIBIT 99 is incorporated herein by reference.
Item 7(c) Exhibits
99 Press Release, dated July 16, 1998, of Hasbro, Inc.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
HASBRO, INC.
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(Registrant)
Date: July 16, 1998 By: /s/ John T. O'Neill
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John T. O'Neill
Executive Vice President and
Chief Financial Officer
(Duly Authorized Officer and
Principal Financial Officer)
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HASBRO, INC.
Current Report on Form 8-K
Dated July 16, 1998
Exhibit Index
Exhibit
No. Exhibits
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99 Press Release dated July 16, 1998
EXHIBIT 99
For Immediate Release Contact: John T. O'Neill
July 16, 1998 401-727-5600
Renita E. O'Connell
401-727-5401
HASBRO, INC. SECOND QUARTER 1998 RESULTS IN LINE WITH EXPECTATIONS
Pawtucket, RI (July 16, 1998) -- Hasbro, Inc. (HAS:ASE) today reported
second quarter results consistent with expectations. Net earnings and diluted
earnings per share were $5.5 million and $0.04, respectively, compared to
$13.0 million and $0.10, respectively, in the second quarter of 1997.
Worldwide net revenues in local currencies were essentially unchanged
from the second quarter of 1997. The acquisition of the operating assets of
Tiger Electronics, on April 1, 1998, added approximately $40 million to net
revenues. This increase was offset by ongoing changes in inventory flow
policies at Toys `R Us, coupled with year-over-year differences in the timing
of movie releases of some of the Company's major entertainment properties. In
addition, the adverse impact of the stronger U.S. dollar reduced revenues by
approximately $9 million, resulting in reported revenues of $572.1 million,
compared to $583.9 million reported last year.
For the first half of 1998, revenues were $1.055 billion, compared to
$1.140 billion a year ago. Net earnings and diluted earnings per share in the
first half were $13.2 million and $0.10, respectively, compared to $38.7
million and $0.30 last year.
"Across the board, our product portfolio performed as expected," said
Alan G. Hassenfeld, Chairman and Chief Executive Officer. "Last year's second
quarter results benefited from the movie releases of THE LOST WORLD: JURASSIC
PARK in May and BATMAN AND ROBIN in June, as well as the re-release of the
STAR WARS TRILOGY. We expected a difficult comparison in the first half of
this year, which has been compounded by the significant reduction in
inventories and increased seasonality of purchasing patterns announced by
Toys `R Us in the first quarter," Hassenfeld explained.
Hassenfeld continued, "On the plus side were sales from newly-acquired
Tiger Electronics, as well as TELETUBBIES, introduced in May, and SMALL
SOLDIERS, which began appearing at retail in June in anticipation of the July
movie release. In addition, sales continue increasing in product lines
including HASBRO INTERACTIVE, ACTION MAN, BEAST WARS/TRANSFORMERS and the
SUPER SOAKER line of water toys. Internationally, growth occurred in Latin
America and certain European markets, notably Italy and France. Our lower
earnings in this seasonally light quarter primarily reflected the anticipated
dilution from interest expense and goodwill amortization associated with our
Tiger acquisition," Hassenfeld added.
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"We have been very active on the financial front," continued Hassenfeld.
"In the second quarter, we invested $55 million to buy back 1.5 million
shares of our common stock, bringing the first half total investment to $108
million to buy back 3.0 million shares. Also, on Tuesday we successfully
priced a $300 million long-term debt offering," said Hassenfeld. "This was
our first long-term debt issue since 1991, and it was significantly
oversubscribed," Hassenfeld added.
"In the increasingly important second half, we will continue building
sales and earnings momentum in several product lines. These include a broad
range of offerings based on Dreamworks' SMALL SOLDIERS, which was off to a
good start at the box office last weekend, the nationwide rollout of
Teletubbies, the fall release of our new CD-ROM version of the ATARI classic
game - CENTIPEDE, and Tiger Electronics' FURBY - an electronic interactive
pet. We also anticipate continued cost savings from the Global Integration
and Profit Enhancement Program," Hassenfeld concluded.
Certain statements contained in this release contain "forward looking
statements" within the meaning of the Private Securities Litigation Reform
Act of 1995. Such forward-looking statements are inherently subject to known
and unknown risks and uncertainties. The Company's actual actions or results
may differ materially from those expected or anticipated in the forward-
looking statements. Specific factors that might cause such a difference
include, but are not limited to, the timely manufacture and shipping by the
Company of new and continuing products and their acceptance by customers and
consumers in a competitive product environment; economic conditions and
currency fluctuations in the various markets in which the Company operates
throughout the world; the continuing trend of increased concentration of the
Company's revenues in the second half and fourth quarter of the year,
together with increased reliance by retailers on quick response inventory
management techniques, which increases the risk of underproduction of popular
items, overproduction of less popular items and failure to achieve tight and
compressed shipping schedules; the impact of competition on revenues, margins
and other aspects of the Company's business; third party actions or approvals
that could delay, modify or increase the cost of implementation of, the
Company's Global Integration and Profit Enhancement program; and the risk
that anticipated benefits of acquisitions may not occur or be delayed or
reduced in their realization. The Company undertakes no obligation to make
any revisions to the forward-looking statements contained in this release or
to update them to reflect events or circumstances occurring after the date of
this release.
# # #
(Tables Attached)
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HASBRO, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(Thousands of Dollars and Shares Except Per Share Data)
Quarter Ended Six Months Ended
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Jun. 28, Jun. 29, Jun. 28, Jun. 29,
1998 1997 1998 1997
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Net Revenues $572,057 583,886 $1,054,877 1,139,670
Cost of Sales 247,095 252,917 451,407 488,288
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Gross Profit 324,962 330,969 603,470 651,382
Amortization 15,880 11,194 30,023 21,226
Royalties, Research and
Development 82,129 87,864 149,465 151,756
Advertising 73,213 66,908 128,970 138,210
Selling, Distribution and
Administration 141,479 142,289 276,728 277,070
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Operating Profit 12,261 22,714 18,284 63,120
Interest Expense 6,416 5,493 8,728 9,923
Other (Income) Expense, Net (2,417) (3,062) (10,514) (7,233)
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Earnings Before Income Taxes 8,262 20,283 20,070 60,430
Income Taxes 2,809 7,302 6,824 21,755
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Net Earnings $ 5,453 12,981 $ 13,246 38,675
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Per Common Share
Net Earnings
Basic $ .04 .10 $ .10 .30
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Diluted $ .04 .10 $ .10 .30
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Cash Dividends Declared $ .08 .08 $ .16 .16
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Weighted Average Number of shares
Basic 132,560 127,847 132,835 128,223
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Diluted 138,228 137,606 138,218 138,158
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HASBRO, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(Thousands of Dollars)
Jun. 28, Jun. 29,
1998 1997
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Assets
Cash and Temporary Investments $ 180,595 $ 82,510
Accounts Receivable, Net 600,254 714,212
Inventories 331,638 368,221
Other 223,740 188,913
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Total Current Assets 1,336,227 1,353,856
Property, Plant and Equipment, Net 281,327 296,139
Other Assets 1,410,211 996,800
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Total Assets $3,027,765 $2,646,795
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Liabilities and Shareholders' Equity
Short-term Borrowings $ 527,259 $ 314,288
Payables and Accrued Liabilities 676,860 517,230
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Total Current Liabilities 1,204,119 831,518
Long-term Debt - 149,040
Deferred Liabilities 77,886 67,206
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Total Liabilities 1,282,005 1,047,764
Total Shareholders' Equity 1,745,760 1,599,031
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Total Liabilities and Shareholders' Equity $3,027,765 $2,646,795
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