The Force is paying off for Hasbro investors. The toymaker just raised its dividend by 11% as it reported better-than-expected Q4 earnings, due in part to the success of the sale of merchandise tied to Star Wars: The Force Awakens.
Hasbro shares are up about 1% on a generally down morning for Wall Street.
The company reported net income of $175.8 million, up 3.4% vs the period in 2014, on revenues of $1.47 billion, up 12.8%. The top line was well above the $1.37 billion that the Street expected. Adjusted earnings, at $1.39 per share, beat forecasts by two cents.
CEO Brian Goldner told analysts that Star Wars “was very strong for us.” Revenues in the category for Boys were up 35% to $569.8 million — with additional contributions from Nerf, Jurassic World and Marvel-related merchandise. That’s impressive considering that the 2014 numbers were bolstered by the release of Transformers: Age Of Extinction.
Transformers sales only fell by about a third, Goldner says, as the brand enjoyed exposure from product-related TV shows. He adds that he’ll have news related to Transformers and Hasbro’s Writers Room projects on Friday at a meeting with analysts at the annual Toy Fair trade show in New York.
The CEO declined to say exactly how much Star Wars contributed to revenues but compared the number to 2005, when Star Wars: Episode III — Revenge Of The Sith was released. He adds that the franchise should do equally as well in 2016 with the new film appearing on home video followed by the December release of Rogue One: A Star Wars Story.
He also noted that Star Wars was especially popular overseas. Before The Force Awakens was out, the U.S. and Canada accounted for about 56% of Hasbro’s sales for the franchise. Afterward, about 54% came from international.
Sales of products targeted to girls fell by 17%, with a drop for Furby and Equestria Girls.
Goldner left himself plenty of wiggle room in his response to a question pegged to last week’s report by Bloomberg that his company has been talking with Mattel about a possible merger. Although he’s “focused on executing our Brand Blueprint strategy,” the CEO adds that he’s “open to add-on acquisitions that would help the strategic platform.”
But CFO Deborah Thomas quickly assured analysts that the company is still “committed to returning excess cash to shareholders” either via dividends or share repurchases.
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