Hasbro CEO Brian Goldner on Tuesday told CNBC that sales are off to a strong start in the fourth quarter.
The toymaker’s third quarter proved to be tough, missing top- and bottom-line estimates in its quarterly report that sent shares down nearly 17% on the session. The chief expressed optimism in that shipments picked up “appreciably” in September following two straight months of decline.
“We have a number of new products coming into the holidays,” he said in a “Mad Money” interview with Jim Cramer. “We said we believe we can grow in the fourth quarter and, as we go forward, we will get through this issue related to the tariffs.”
The U.S.-China trade war has weighed heavily on Hasbro’s shipping and warehousing costs, Goldner said. Tariffs and the threat of more tariffs on toys imported from China is a headwind that the company has tried to dodge throughout the year. Hasbro is the parent of household toy brands Transformers, G.I. Joe and Power Rangers, among others.
Hasbro faces another 10% tariff hike that President Donald Trump plans to impose on toys and a list of other products shipped from China. The new round of tariffs was initially scheduled for Sept. 1, but it was delayed with the holiday shopping season in mind.
“Going forward after fourth quarter 2019 our teams, like we always do, address these issues in real time,” Goldner said. “We have a way to go forward with our retailers where tariffs, whether they’re enacted or not, will not have an impact on our business, but in the short term it did have an impact.”
Hasbro is relying on a range of new and soon-to-be released products to carry sales in the Christmas quarter. Goldner counted the debut of Disney’s “Frozen 2” among them. He said “we’re seeing very strong growth” from the latest “Star Wars” movie and that the Nerf Ultra launch is “off to a very good start.” The Play Doh, Transformers, Monopoly and Magic: The Gathering businesses are up year to date, he added.
“We’ve come out of the gates into the fourth quarter strongly,” Goldner said.
Hasbro is expected to record more than $1.5 billion in total revenue and $1.51 of profit per share in the December quarter, based on analyst consensus. Wall Street expects $4.68 earnings per share on nearly $5 billion totals for full-year 2019, according to FactSet.
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