Hasbro, the nation's second largest toymaker, posted strong earnings for 2007 with sales boosted by a 78% increase in the 'boys' toys' category, which was driven by Transformers, Star Wars and Spider-Man. Hasbro CEO Alfred Verrecchia (who is leaving on a high note to become Chairman of the Board) told analysts on a conference call that in contrast to big increases in the boys' and girls' toy categories, games were up just 2% for Hasbro in 2007, with a 6% increase in sales of board games making up for a decline in sales of trading card games.
Overall for 2007 Hasbro's North American revenues were up 16% while International revenues climbed 33% (24% in local currencies). Verrecchia noted that 'Transformers is our leading brand,' with sales of over $480 million in 2007 and strong momentum in 2008 thanks in part to the debut of the Transformers Animated series in January. With the expected settlement of the writers' strike Verrecchia indicated that the Transformers 2 movie was on schedule for a 2009 release (and that the G.I. Joe movie, which started shooting this week, was also on pace for its 2009 debut).
Star Wars sales also remained strong in 2007 and Hasbro is looking forward to the release of new Star Wars TV animation later this year. Verrecchia also noted that the new Spider-Man animated series was debuting in March and that Marvel's Iron Man (May) and Hulk (June) movies should also help drive sales. Questioned about reported high inventories of Spider-Man 3 toys at retail, Verrecchia first pointed out that not all the Spidey 3 items at retail are 'our stuff,' and then noted that inventories had been higher than expected going in to Q4, but the release of the Spider-Man 3 DVD and the holiday season combined to reduce inventories to satisfactory levels.
While Verrecchia did not comment directly on Wizards of the Coast's 2007 performance he did note that one of the major investments that Hasbro made in 2007 (and which would continue in 2008) involved expenditures to improve the online Magic the Gathering Website and the construction of the WotC's major online initiative, Gleemax (see 'Gleemax, WotC's New Online Initiative').