According to the company, revenue growth in all segments highlights the strength of Hasbro’s Brand Blueprint strategy.
Hasbro’s first quarter 2022 results have been released, with net revenue increasing 4% to $1.16b. There were several stand-out performers, including Wizards of the Coast and the Digital Gaming segment, where revenue increased by 9%. The Consumer Products segment saw revenue grow by 3%, while Entertainment segment revenues increased by 4%.
Commenting on the results, Chris Cocks, Hasbro chief executive officer, said: “The Hasbro teams executed well in the first quarter, growing revenue across segments and positioning us to increase our profit outlook for the year. Based on our current plans, we now believe mid-single digit adjusted operating profit growth and a 16% adjusted operating profit margin is achievable on revenue growth of low-single digits. As I assumed the role of Hasbro CEO on February 25th, we began a thorough review of our business with a theme of focus and scale. We are leaning into our strengths and greatest growth opportunities, including in gaming, multi-generational brands and direct to consumer. Hasbro has carefully assembled an unmatched portfolio of brand-building capabilities and valuable brands to drive profitable growth and long-term shareholder returns.”
Deborah Thomas, Hasbro chief financial officer, added: “Our first quarter results were in line with our plans, as the team continued to manage supply chain disruptions, positioning us to meet or exceed our outlook for the year. As we discussed at year end, pricing increases went into effect in our consumer products business at the beginning of the second quarter and will help offset the higher input and freight costs in future quarters. Given our cash position and positive outlook, we are resuming our share repurchase program, with a plan to repurchase $75 to $150m this year.”
For the first quarter 2022, revenues grew in Franchise Brands, Partner Brands, Hasbro Gaming and Emerging Brands. Top brand performances included Magic: The Gathering, My Little Pony, Peppa Pig and Hasbro products for the Marvel portfolio, led by the Spider-Man franchise, including products in support of Marvel Studios’ Spider-Man: No Way Home and the new animated show Marvel’s Spidey and His Amazing Friends, plus Avengers franchise support with the upcoming Marvel Studios’ Doctor Strange in the Multiverse of Madness.
Operating profit declined to $8.6m in the traditionally low profit quarter for toys and games. Supply chain disruptions impacted product availability, which caused delays at retail, while higher freight and inventory costs negatively impacted profits versus the same period last year. To offset these headwinds, product price increases go into effect in the second quarter.
Following a strong year in 2021, Hasbro stated that it plans for continued growth in 2022; projections are for low-single digit revenue growth, despite the strengthening of the US dollar and potential exposure of around $100m in Russia. The company has also announced two C-suite leadership appointments, as Shane Azzi joins as chief global supply chain officer and Matt Austin is promoted to chief commercial officer.
“I’m very excited to appoint these two critical leadership positions at a time of tremendous opportunity for Hasbro’s business. With our focus on executing our strategy across high potential brands, our thriving gaming business, and our unique multi-generational entertainment and consumer direct capabilities, we are well positioned to deliver growth for years to come,” said Eric Nyman, president and chief operating officer, Hasbro. “Shane brings incredible global supply chain experience and will help us modernize and streamline Hasbro’s backend operations over the coming quarters, and Matt is a proven leader who understands the world-class commercial capabilities needed to drive our business forward.”
Shane will join Hasbro on May 4th following the retirement of Tom Courtney, executive vice president & chief global operations officer, who moved into an advisory role on 1st April 2022 after 30 years with the company and will retire at the end of 2022. A successor to Matt as president for Europe and Asia will be named in the coming months.