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Shares of world's second biggest toy company Hasbro Inc. (NYSE: HAS) have been been rallying in early trading after the company reported better-than-expected first quarter earnings, as its strong international business was able to offset declining domestic sales.
Hasbro said that its profit jumped 14% to $37.5 million, or 25 cents per share, helped by strong sales in its Transformers and Littlest Pet Shop lines. These numbers are up from $32.9 million, or 19 cents per share, a year earlier. Analysts, on average, expected earnings of 14 cents.
The toymaker also posted posted a respectable growth of 13% for its first-quarter revenue, which climbed to $704.2 million from $625.3 million. During the period, Hasbro benefited from the weak dollar which was a major driver for its international sales. The company saw overseas sales rise 22% to $248.3 million while revenue in the U.S. and Canada rose only 6% to $428.5 million. Analysts expected $582.2 million in sales in the first quarter, according to Reuters Estimates.
The company's "first-quarter performance reinforces the confidence we have in achieving our full-year financial goals," Alfred Verrecchia, the toymaker's Chief Executive Officer, stated. Hasbro's satisfaction is even bigger as its main rival Mattel Inc. (NYSE: MAT) announced it swung to a loss of $46.6 million in the first-quarter, and posted lower-than-expected earnings.
With the current challenging environment, Hasbro is launching new products related to summer films "Iron Man," "Indiana Jones and the Kingdom of the Crystal Skull" and "The Incredible Hulk." that could capture customers' interest to summer summer films.
Traders have expressed their enthusiasm over the company's surprising quarterly results, pushing the stock up over 5.23% in early morning trading.
Eliza Popescu is a financial writer for the online investment advisory service Investor's Observer.
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