UPDATE 4-Hasbro posts strong profit; shares hit new high

* Q3 EPS $1.09 vs Wall Street view $1.04

* Sales rise 3 pct to $1.31 bln, beating estimates

* Expects ‘very robust’ holiday shopping season

* Hasbro shares up 4.9 pct, hit all-time high
(Adds CEO, COO comments, details, background, stock action)

By Ben Klayman

DETROIT, Oct 18 (BestGrowthStock) – Hasbro Inc (HAS.N: ) reported a
higher-than-expected quarterly profit on strong demand for its
preschool toys and boys’ lines such as Nerf foam products,
sending its shares to an all-time high.

The No. 2 U.S. toy company’s results came as a relief to
investors after larger rival Mattel Inc (MAT.O: ) missed
quarterly sales estimates on an unexpected decline at its
Fisher-Price infant and preschool toy business. Mattel
executives also said consumers were still wary ahead of the
holiday shopping season. [ID:nN14136493]

Hasbro Chief Executive Officer Brian Goldner was far more
confident, saying retailers were adding space in stores for
toys and that there were no major delays in stocking
inventory.

“Certainly, we expect a very robust holiday season,” he
told analysts on a conference call.

Chief Operating Officer David Hargreaves said Hasbro was
happy with retailer inventory levels. “We’re looking for strong
sell-through in the fourth quarter, and we think the levels of
inventories support that.”

The company, whose brands also include Playskool and
Monopoly, said it still expected an increase in full-year
revenue and earnings per share, including spending for its new
television network, The Hub.

“Very good execution on Hasbro’s side,” said BMO Capital
Markets analyst Gerrick Johnson, who has a “market perform”
rating on the shares. “Nerf is doing very, very well. That’s
driving significant increases in boys, and the preschool line
looks reinvigorated.”

Hasbro’s third-quarter net income rose to $155.2 million,
or $1.09 a share, from $150.4 million, or 99 cents a share, a
year earlier. The profit was 5 cents a share higher than the
average forecast from analysts polled by Thomson Reuters
I/B/E/S.

Revenue rose 3 percent to $1.31 billion, topping the $1.29
billion analysts had expected. Excluding currency changes, it
was up 4 percent.

Hasbro shares were up 4.9 percent at $47.30 after hitting
an all-time high of $48.78 earlier in the session. Mattel rose
0.5 percent.

HASBRO PRESCHOOL SALES JUMP

Mattel said on Friday that sales at its Fisher-Price unit
had dropped 5 percent, while some Wall Street analysts were
expecting an increase of up to 10 percent. The company cited a
move to delay marketing programs until closer to the Christmas
holidays as shoppers are more likely to buy at the last
minute.

It also noted shipments to U.S. retailers were a bit soft
late in its most recent quarter as more chains tried to avoid
getting stuck with excess inventory. Mattel executives said
they did not know how the holiday season would play out.

However, preschool toy sales led Hasbro’s revenue growth,
with a 9 percent jump in the quarter. Boys, the largest
category, rose 4 percent, while Stifel Nicolaus had forecast a
1.1 percent decline.

Sales of games and puzzles rose 2 percent, while girls
slipped 1 percent.

Hasbro’s entertainment and licensing segment’s revenue fell
34 percent due to declines in “Transformers” and “G.I. Joe”
movie-related sales.

Looking ahead, Hasbro holds licenses to make merchandise
tied to 2011 movies releases such as “Transformers 3”, “Thor”
and “The First Avenger: Captain America.”

The company said the fourth quarter would reflect the
largest percentage of an expected expense of 25 cents to 30
cents per share to support the launch this month of The Hub, a
new children’s TV network formed with Discovery Communications
Inc (DISCA.O: ).

The channel, launched on Oct. 10, will replace Discovery
Kids in 60 million cable and satellite homes, aiming to fill a
void between networks with preschool-age programming and those
with shows for 11-to-14-year-olds. [ID:nN08104421]

Goldner said the company feels very good about the early TV
ratings for the new network.
(Reporting by Ben Klayman; additional reporting by Dhanya
Skariachan and Yinka Adegoke; Editing by Lisa Von Ahn and
Maureen Bavdek)

UPDATE 4-Hasbro posts strong profit; shares hit new high