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 15, 1999
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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 15, 1999 Press Release of the Registrant attached
hereto as EXHIBIT 99 is incorporated herein by reference.
Item 7(c) Exhibits
99 Press Release, dated July 15, 1999, 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 15, 1999 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 15, 1999
Exhibit Index
Exhibit
No. Exhibits
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99 Press Release dated July 15, 1999
EXHIBIT 99
For Immediate Release Contact: John T. O'Neill
July 15, 1999 401-727-5600
Renita E. O'Connell
401-727-5401
HASBRO REPORTS RECORD SECOND QUARTER RESULTS
Pawtucket, RI (July 15, 1999) -- Hasbro, Inc. (NYSE:HAS) today reported
record second quarter revenues, earnings and earnings per share.
Worldwide net revenues increased approximately 53% to $874.6 million,
compared to $572.1 million a year ago. Revenue growth was driven primarily
by significantly higher shipments of STAR WARS and Tiger Electronics
products, and increased sales of computer-based games from Hasbro
Interactive. Net earnings and diluted earnings per share increased
approximately six-fold to $32.3 million and $0.16, respectively, compared to
$5.5 million and $0.03, respectively, last year. The Company also reported
record second quarter Earnings Before Interest, Taxes, Depreciation and
Amortization (EBITDA) of $118.3 million, more than double the year-ago EBITDA
of $52.5 million.
For the first half of 1999, worldwide net revenues increased
approximately 46% to $1.543 billion, compared to $1.055 billion a year ago.
Net earnings and diluted earnings per share in the first half more than
tripled, to $46.1 million and $0.22, respectively, compared to $13.2 million
and $0.06 last year.
"We are very pleased to report a record second quarter in all respects
and to significantly exceed expectations, which were already high," said Alan
G. Hassenfeld, Chairman and Chief Executive Officer. "We are also excited
about the rest of the year and our outstanding diversified brand and product
portfolio, led by STAR WARS and the POWER OF THE FORCE."
"We are firing on all cylinders," Hassenfeld continued. "Our awesome
STAR WARS product line, launched in early May in the U.S. for the May 19
release of STAR WARS: EPISODE I: THE PHANTOM MENACE, has in many cases
exceeded our high expectations. The international rollouts of STAR WARS
product and the movie continue to be met with great enthusiasm. Tiger
Electronics' interactive FURBY is a smash hit internationally and continues
selling briskly in the U.S. Hasbro Interactive again achieved significant
double-digit sales increases. MECHWARRIOR 3 was the number one PC software
title one week after its launch in early June and remains in the top ten.
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"We continue working hard to enhance shareholder value," Hassenfeld
added. In June, Hasbro common stock was listed on the New York Stock
Exchange. During the second quarter, we invested a total of $147 million to
repurchase almost 5 million shares of our common stock. This includes
approximately $90 million to repurchase most of Dreamworks' equity interest
in Hasbro, substantially eliminating future dilution from this interest. We
seized this significant opportunity to accelerate repurchases because we are
bullish on the strength of our business and we believe in our future. Under
the $500 million repurchase authorization of December 1997, we have invested
a total of more than $380 million to repurchase almost 15 million shares.
Earlier this month, we filed a shelf Registration Statement with the
Securities and Exchange Commission for $350 million of public debt
securities, which would bring Hasbro's total public debt authorization to
$500 million and further enhance our financial flexibility."
"We look forward to a strong second half. We are shipping new STAR WARS
action figures and other terrific EPISODE I product. The successful rollout
of the POWER OF THE FORCE continues around the world. Tiger Electronics'
French and Italian FURBY TOYS are shipping, FURBY BABIES debut in third
quarter, and we will ship two more limited edition holiday FURBY TOYS. Hasbro
Interactive plans several new titles, including the first from its newly-
formed Hasbro Sports unit: TRIVIAL PURSUIT NASCAR CD-ROM, Hasbro Sports
Digital Camera and em@il NFL FOOTBALL. We will ship our expanded POKEMON
offering, including the electronic interactive plush "I CHOOSE YOU PIKACHU".
The U.S. release of the first animated POKEMON feature film on November 12
will extend the excitement of POKEMANIA into next year. With POKEMON, plus
other wonderful new product including NASCAR SUPERCHARGERS, BEAST MACHINES,
TITAN AE, DRAGON TALES and TWEENIES, we have even more visibility for the
year 2000," Hassenfeld concluded.
Hasbro is a worldwide leader in the design, manufacture and marketing of
toys, games, interactive software, puzzles and infant products. Both
internationally and in the U.S., its PLAYSKOOL, KENNER, TONKA, ODDZON, SUPER
SOAKER, MILTON BRADLEY, PARKER BROTHERS, TIGER, HASBRO INTERACTIVE, and
GALOOB products provide children and families with the highest quality and
most recognizable toys and games in the world.
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, currency
fluctuations and government regulation and other actions in the various
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markets in which the Company operates throughout the world; the inventory
policies of retailers, including the continuing trend of 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; the Company's
incurring higher than expected costs to achieve, or not achieving, "Year
2000" readiness with respect to the Company's systems, or the Company's
customers, vendors or service providers failing to achieve such readiness;
and the risk that anticipated benefits of acquisitions or the Company's
Global Integration and Profit Enhancement program 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.
EBITDA (earnings before interest, taxes, depreciation and amortization)
represents operating profit plus depreciation and all amortization. EBITDA is
not adjusted for all noncash expenses or for working capital, capital
expenditures or other investment requirements and, accordingly, is not
necessarily indicative of amounts that may be available for discretionary
uses. Thus, EBITDA should not be considered in isolation or as a substitute
for net earnings or cash provided by operating activities, each prepared in
accordance with generally accepted accounting principles, when measuring
Hasbro's profitability or liquidity as more fully discussed in the Company's
financial statements and securities filings.
# # #
(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. 27, Jun. 28, Jun. 27, Jun. 28,
1999 1998 1999 1998
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Net Revenues $874,574 572,057 $1,542,972 1,054,877
Cost of Sales 345,026 247,095 601,543 451,407
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Gross Profit 529,548 324,962 941,429 603,470
Amortization 31,918 15,880 57,844 30,023
Royalties, Research and
Development 179,776 82,129 291,718 149,465
Advertising 101,274 73,213 182,358 128,970
Selling, Distribution and
Administration 158,368 141,479 321,649 276,728
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Operating Profit 58,212 12,261 87,860 18,284
Interest Expense 13,625 6,416 25,598 8,728
Other (Income) Expense, Net (2,209) (2,417) (4,527) (10,514)
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Earnings Before Income Taxes 46,796 8,262 66,789 20,070
Income Taxes 14,507 2,809 20,705 6,824
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Net Earnings $ 32,289 5,453 $ 46,084 13,246
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Per Common Share
Net Earnings
Basic $ .17 .03 $ .24 .07
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Diluted $ .16 .03 $ .22 .06
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Cash Dividends Declared $ .06 .05 $ .12 .10
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Weighted Average Number of shares
Basic 195,330 198,839 195,614 199,252
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Diluted 207,052 207,341 205,836 207,327
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HASBRO, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(Thousands of Dollars)
Jun. 27, Jun. 28,
1999 1998
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Assets
Cash and Temporary Investments $ 97,765 $ 180,595
Accounts Receivable, Net 843,580 600,254
Inventories 433,460 331,638
Other 586,115 223,740
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Total Current Assets 1,960,920 1,336,227
Property, Plant and Equipment, Net 308,420 281,327
Other Assets 1,631,797 1,410,211
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Total Assets $3,901,137 $3,027,765
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Liabilities and Shareholders' Equity
Short-term Borrowings $ 823,202 $ 527,259
Payables and Accrued Liabilities 786,176 676,860
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Total Current Liabilities 1,609,378 1,204,119
Long-term Debt 409,937 -
Deferred Liabilities 77,700 77,886
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Total Liabilities 2,097,015 1,282,005
Total Shareholders' Equity 1,804,122 1,745,760
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Total Liabilities and Shareholders' Equity $3,901,137 $3,027,765
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