Hasbro to Slash 10% Workforce in Fiscal 2013, Revenue Outlook for 2012 Misses Street’s Forecast (HAS)
Toymaker Hasbro Inc. (NASDAQ: HAS) said on Friday that it will slash 10% of its total workforce in the current year as the company looks to cut costs in the wake of slackness in demand even as it warned that fiscal 2012 results will miss Wall Street’s expectations.
Shares fell almost 3% to settle at $37.31 on Friday. The Company is scheduled to report its fiscal fourth quarter earnings on February 7.
The Pawtucket, Rhode Island based Company, which is renowned for its brands such as, Transformers, GI Joe toys, Monopoly and Nerf, has now provided profit warning for the third successive year before reporting final full year results.
The downbeat outlook from Hasbro also impacted its rivals’ stocks on Friday. Shares of Mattel Inc. (NASDAQ: MAT) fell 2.34%, those of Leapfrog Enterprises Inc. (NYSE: LF) plunged 4.15 while shares of Jakks Pacific (NASDAQ: JAKK) Inc dropped 1.1%.
Lately, the toy industry has been under immense pressure due to a very wobbly macroeconomic environment in the U.S., which forced consumers to spend frugally. Weakness in the European economy and growing usage of multi-purpose mobile devices has also impacted the demand for toys and games.
As more and more children and parents remain hooked to smartphones and tablets, no time is left for them to play with physical toys.
For Hasbro, the problem is even deeper. The demand for those categories, which Hasbro make, is declining in the U.S., its biggest market.
According to the Wall Street Journal, a data provided NPD Group data showed that sales for games and puzzles and action figures was lackluster last year —two categories which Hasbro focuses with properties like Twister, Monopoly and Marvel-based action figures.
For fiscal 2012, the Company expects adjusted earnings to come in the range of $2.73 a share to $2.75, Revenue is expected to shrink 4.7% to $4.09 billion.
Analysts polled by Thomson Reuters had most recently forecasted earnings of $2.85 on revenue of $4.21 billion.
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Post Written By: Ed Liston
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.
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