Hasbro 2006 Annual Report Download

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Table of contents

  • Page 1

  • Page 2
    ... to accounting principles generally accepted in the United States of America. See Management's Discussion and Analysis of Financial Condition and Results of Operations in the enclosed annual report for a detailed discussion of the Company's business. The discussion set forth in the following letter...

  • Page 3
    ...to $1.09 per share in 2005. • Worldwide net revenue growth of 2% to $3.2 billion, driven principally by the excellent performance of our core brands. Excluding STAR WARS, revenues grew 11% or $273 million for the year, further proof that our core brand strategy is working. • Operating profit of...

  • Page 4
    ... our successful FURREAL FRIENDS brand was a breakthrough product that delivered an amazing level of realism in a format that enabled little girls to role-play as if they had a "real" pony. It impressed consumers, retailers and industry veterans alike and was awarded two prestigious T.O.T.Y. (Toy of...

  • Page 5
    ... in 2007 when MONOPOLY - HERE & NOW ELECTRONIC BANKING edition launches in several markets after having a very successful launch in Europe last year. Electronic banking eliminates all cash and replaces this play with credit cards and a central electronic bank that quickly manages all financial...

  • Page 6
    ... great value and an inexpensive way to entertain the entire family. THE GAME OF LIFE - TWISTS & TURNS is a great example of core brand reinvention. Coming in 2007, it introduces a fun new play pattern that is all about choice, control and consequences as players determine which path in life to take...

  • Page 7
    ... such as GHOST RIDER, SPIDER-MAN and FANTASTIC FOUR, all supported by major motion pictures in 2007, and movies for THE INCREDIBLE HULK and IRON MAN in 2008. Importantly, we see a significant opportunity in tapping the underleveraged SPIDER-MAN collector business with an aggressive program using...

  • Page 8
    ...are proud to report that in 2006, the Hasbro Children's Fund helped nearly six million children through charitable grants, product donations, and our Team Hasbro employee volunteer program. Moving For ward 2006 was a very good year for Hasbro and we're excited about the opportunities that lie ahead...

  • Page 9
    ...Vice President, Finance and Global Operations and Chief Financial Offi cer Jack M. Greenberg Chairman The Western Union Company Frank P. Bifulco, Jr. President, North American Sales Claudine B. Malone President and Chief Executive Offi cer Financial and Management Consulting, Inc. Barry Nagler...

  • Page 10
    5 -Year Total Shareholder Return Hasbro vs. S & P 50 0 and Russell 10 0 0 Consumer Discretionar y Economic Sector The following graph tracks an assumed investment of $100 at the end of 2001 in the Company's Common Stock, the S&P 500 Index and the Russell 1000 Consumer Discretionary Economic Sector,...

  • Page 11
    ... file number 1-6682 Hasbro, Inc. (Exact Name of Registrant, As Specified in its Charter) Rhode Island (State of Incorporation) 05-0155090 (I.R.S. Employer Identification No.) 1027 Newport Avenue, Pawtucket, Rhode Island (Address of Principal Executive Offices) 02862 (Zip Code) Registrant...

  • Page 12
    ... MY LITTLE PONY in 2003. Major 2006 brands and products included STAR WARS, PLAYSKOOL, LITTLEST PET SHOP, NERF, MAGIC: THE GATHERING, PLAY-DOH, TRANSFORMERS and MONOPOLY. In the North American segment, our products are organized into the following categories: (i) games and puzzles; (ii) boys' toys...

  • Page 13
    ... of core brands marketed primarily under the PLAYSKOOL trademark. The PLAYSKOOL line includes such well-known products as MR. POTATO HEAD, WEEBLES, SIT 'N SPIN and GLOWORM, along with a successful line of infant toys including STEP START WALK 'N RIDE, 2-IN-1 TUMMY TIME GYM and BUSY BALL POPPER. In...

  • Page 14
    ...South America. Key international brands for 2006 included MONOPOLY, MY LITTLE PONY, PLAYSKOOL, STAR WARS, and LITTLEST PET SHOP. Other Segments In our Global Operations segment, we manufacture and source production of substantially all of our toy and game products. The Company operates manufacturing...

  • Page 15
    ...ongoing products. Much of this work is performed by our internal staff of designers, artists, model makers and engineers. In addition to the design and development work performed by our own staff, we deal with a number of independent toy and game designers for whose designs and ideas we compete with...

  • Page 16
    ... the years 2007 through 2018. Marketing and Sales Our products are sold nationally and internationally to a broad spectrum of customers, including wholesalers, distributors, chain stores, discount stores, mail order houses, catalog stores, department stores and other traditional retailers, large and...

  • Page 17
    ... We compete with several large toy and game companies in our product categories, as well as many smaller United States and international toy and game designers, manufacturers and marketers. Competition is based primarily on meeting consumer entertainment preferences and on the quality and play value...

  • Page 18
    ... children's programming. We maintain programs to comply with various United States federal, state, local and international requirements relating to the environment, plant safety and other matters. Financial Information About International and United States Operations and Export Sales The information...

  • Page 19
    ... business and financial condition. In our industry, it is important to identify and offer what are considered to be the "hot" toys and games on children's "wish lists". Our continued success will depend on our ability to develop, market and sell popular toys, games and children's electronic products...

  • Page 20
    ... game suppliers, consumer electronics companies and other businesses outside of the traditional toy and game industry. In addition to designing and developing products based on our own brands, we seek to fulfill consumer preferences and interests by producing products based on popular entertainment...

  • Page 21
    ... licensed products is not sufficient to earn out the minimum guaranteed royalties. An important part of our business involves obtaining licenses to produce products based on various entertainment properties and theatrical releases, such as those based upon MARVEL or STAR WARS characters. The license...

  • Page 22
    ... to acquire or maintain successful entertainment licenses on advantageous terms, our revenues and profits may be harmed. Our substantial sales and manufacturing operations outside the United States subject us to risks associated with international operations. We operate facilities and sell products...

  • Page 23
    ... to our business, our financial condition and results of operations could be significantly harmed if any of the risks described above were to occur. Part of our strategy for remaining relevant to older children is to offer innovative children's toy and game electronic products. The margins on many...

  • Page 24
    ... that the integration of the product lines of the companies that we acquire into our operations will create production, marketing and other operating synergies which will produce greater revenue growth and profitability and, where applicable, cost savings, operating efficiencies and other advantages...

  • Page 25
    ... credit facility and other bank lines, a circumstance which potentially could occur when operating shortfalls would most require supplementary borrowings to enable us to continue to fund our operations. As an additional source of working capital and liquidity, we currently have a $250,000 accounts...

  • Page 26
    ... year, could be significant. In addition, any product recall, regardless of direct costs of the recall, may harm consumer perceptions of our products and have a negative impact on our future sales and results of operations. In addition to government regulation, products that have been or may be...

  • Page 27
    ... ... Administrative, Sales & Marketing, and Product Development offices Executive Office Administrative Office Warehouse Office, Manufacturing & Warehouse Warehouse Warehouse Warehouse Office Warehouse Office & Warehouse Office Office & Showroom Office, Warehouse & Showroom Sales Office & Showroom...

  • Page 28
    Location Use Square Feet Type of Possession Lease Expiration Dates Hong Kong Kowloon(3) ...New Territories(3) ...New ...Corporate function. (3) Property used in the Global Operations segment. (4) Property used in the International segment. In addition to the above listed facilities, the Company...

  • Page 29
    ... Games since joining the Company in June 2003; prior thereto, Senior Vice President and Chief Marketing Officer of The Timberland Company since 2001. (5) From 2002 to 2003 also President, Asia Pacific; prior to 2002, President, Hasbro International. (6) Prior thereto, Vice President and Assistant...

  • Page 30
    ...'s Common Stock as of February 8, 2007 was 9,400. See Part III, Item 12 of this report for the information concerning the Company's "Equity Compensation Plans". Dividends Declaration of dividends is at the discretion of the Company's Board of Directors and will depend upon the earnings and financial...

  • Page 31
    ...of the exercise price and related taxes. These shares were purchased at the market prices on the dates of the exercises of the stock options. Item 6. Selected Financial Data Fiscal Year 2006 2005 2004 2003 2002 (Thousands of dollars and shares except per share data and ratios) Statement of Earnings...

  • Page 32
    ...STAR WARS properties. In January 2006 the Company simplified its operating segment structure in order to better focus on consumer demands, better anticipate the needs of its retail customers, provide a more integrated toy and game marketing plan, place a greater company-wide focus on its core brands...

  • Page 33
    ...property with the Company's ability to design and produce action figures, role playing toys, and games, as well as its ability to launch an integrated marketing campaign to promote the product globally, was the key to this line's success. While sales of product related to this license performed well...

  • Page 34
    .... On December 26, 2005, the first day of fiscal 2006, the Company adopted Statement of Financial Accounting Standards No. 123 (revised 2004), "Share-Based Payment" ("SFAS 123R"), which required that the Company measure all stock-based compensation awards using a fair value method and record...

  • Page 35
    ...revenues that represented STAR WARS products, which do not require as much advertising and promotion to raise awareness as an internally-developed product would. North American operating profit was negatively impacted in 2005 by a loss of approximately $23,000 in the electronic games category, which...

  • Page 36
    ... LITTLEST PET SHOP, PLAYSKOOL and MONOPOLY products. To a lesser extent, 2006 net revenues were also positively impacted by increased sales of MY LITTLE PONY, TRANSFORMERS, and PLAY-DOH products as well as the reintroduction of the BABY ALIVE doll. International segment operating profit decreased...

  • Page 37
    ...2006 compared to $247,283 or 8.0% of net revenues in 2005. This decrease primarily relates to the decrease in sales of STAR WARS products in 2006, as a higher percentage of net revenues were from the Company's core brands. Royalty expense in 2005 increased to $247,283 or 8.0% of net revenues in 2005...

  • Page 38
    ... (income) related to the change in fair value of these warrants was $31,770, $(2,080) and $(12,710), respectively. The fair value of these warrants is primarily affected by the Company's stock price, but is also affected by the Company's stock price volatility and dividends, as well as risk-free...

  • Page 39
    ... from operations and funds available through its securitization program and other available lines of credit, are adequate to meet its needs for 2007. During the last five fiscal years, as part of its strategy of reducing long-term debt and its overall debt-to-capitalization ratio, the Company has...

  • Page 40
    ... of operations as the related sales are recorded. The decrease related to prepaid royalties was partially offset by increased deferred taxes. With respect to the MARVEL and STAR WARS licenses, the Company has prepaid royalties recorded in both current and non-current assets. Accounts payable and...

  • Page 41
    ... in fair value recognized in the statement of operations. If the closing price of the Company's stock exceeds $23.76 for at least 20 trading days, within the 30 consecutive trading day period ending on the last trading day of the calendar quarter, or upon other specified events, the debentures will...

  • Page 42
    ... depend on a number of factors, including the price of the Company's stock. The Company may suspend or discontinue the program at any time and there is no expiration date. In 2006, the Company repurchased 22,767 shares at an average price of $20.03 under these authorizations. The total cost of these...

  • Page 43
    ... been no material adjustments to the Company's estimates. Inventory Valuation Inventory is valued at the lower of cost or market. Based upon a consideration of quantities on hand, actual and projected sales volume, anticipated product selling prices and product lines planned to be discontinued, slow...

  • Page 44
    ... flow projections to be derived from the related product. If sales forecasts and related cash flows from the particular product do not support the recoverability of the remaining minimum guaranty or, if the Company decides to discontinue a product line with royalty advances or commitments, a charge...

  • Page 45
    ... these awards. Contractual Obligations and Commercial Commitments In the normal course of its business, the Company enters into contracts related to obtaining rights to produce product under license, which may require the payment of minimum guarantees, as well as contracts related to the leasing of...

  • Page 46
    ...has letters of credit and related instruments of approximately $71,000 at December 31, 2006. Financial Risk Management The Company is exposed to market risks attributable to fluctuations in foreign currency exchange rates primarily as the result of sourcing products priced in U.S. dollars, Hong Kong...

  • Page 47
    ... shipping schedules. The business of the Company is characterized by customer order patterns which vary from year to year largely because of differences in the degree of consumer acceptance of a product line, product availability, marketing strategies, inventory levels, policies of retailers and...

  • Page 48
    ... compliance costs or liabilities to be material to its operating results or financial position. Item 7A. Quantitative and Qualitative Disclosures About Market Risk The information required by this item is included in Item 7 of Part II of this Report and is incorporated herein by reference. 37

  • Page 49
    ...an unqualified opinion on management's assessment of, and the effective operation of, internal control over financial reporting. As discussed in note 10 to the consolidated financial statements, during the first quarter of 2006, the Company adopted Statement of Financial Accounting Standards No. 123...

  • Page 50
    ...; issued 209,694,630 shares in 2006 and 2005 ...Additional paid-in capital ...Deferred compensation ...Retained earnings ...Accumulated other comprehensive earnings ...Treasury stock, at cost, 49,074,215 shares in 2006 and 31,744,690 shares in 2005...Total shareholders' equity ...905,893 494,917...

  • Page 51
    ... Statements of Operations Fiscal Years Ended in December (Thousands of dollars except per share data) 2006 2005 2004 Net revenues ...$3,151,481 Cost of sales ...1,303,885 Gross profit...Expenses Amortization ...Royalties ...Research and product development ...Advertising ...Selling, distribution...

  • Page 52
    ... maturities of more than three months ...Net repayments of other short-term borrowings ...Purchase of common stock ...Stock option transactions...Excess tax benefits from stock-based compensation ...Dividends paid ... ... ... ... (32,743) (3,726) (456,744) 86,257 14,959 (75,282) (467,279) 3,368 (226...

  • Page 53
    ...Earnings Total Shareholders' Equity Common Stock Deferred Compensation Retained Earnings Treasury Stock Balance, December 28, 2003 ...Net earnings ...Other comprehensive earnings...Comprehensive earnings ...Stock option and warrant transactions ...Restricted stock activity ...Dividends declared...

  • Page 54
    ...customers on credit who are experiencing financial difficulties, management performs additional financial analyses before shipping orders. The Company uses a variety of financial transactions based on availability and cost, to increase the collectibility of certain of its accounts, including letters...

  • Page 55
    ... trademarks, copyrights, patents, license agreements and other product-related rights. These rights were valued at their acquisition date based on the anticipated future cash flows from the underlying product line. The Company has certain intangible assets related to the Tonka and Milton Bradley...

  • Page 56
    ... market information. Securitization and Transfer of Financial Instruments Hasbro has an agreement that allows the Company to sell, on an ongoing basis, an undivided interest in certain of its trade accounts receivable through a revolving securitization arrangement. The Company retains servicing...

  • Page 57
    ..., "Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans" ("SFAS 158"), which amends SFAS 87, 88, 106 and 132(R). See footnotes 2 and 11 for the impact of adoption of this statement. The Company's policy is to fund amounts which are required by applicable regulations and...

  • Page 58
    ...rate swap contracts are with a number of major financial institutions in order to minimize counterparty credit risk. The Company believes that it is unlikely that any of its counterparties will be unable to perform under the terms of the contracts. Accounting for Stock-Based Compensation At December...

  • Page 59
    ... Board Opinion No. 25, "Accounting for Stock Issued to Employees", and related interpretations. As required by the Company's existing stock plans, stock options are granted at or above the fair market value of the Company's stock and, accordingly, no compensation expense was recognized for these...

  • Page 60
    ... may be settled in cash or common stock are required to be accounted for as a liability at fair value. The Company is required to assess if these warrants, classified as a liability, have a more dilutive impact on earnings per share when treated as an equity contract. As of December 31, 2006, the...

  • Page 61
    ...The reclassification adjustments for 2006 and 2004 includes an impairment charge relating to other than temporary decreases in the value of the Company's available-for-sale securities. In accordance with Hasbro's marketable securities accounting policy, as the result of the decline in the fair value...

  • Page 62
    ... Company has adjusted its prior year information to reflect the current reporting structure and reallocated Corporate segment amounts. Changes in carrying amount of goodwill, by operating segment for the years ended December 31, 2006 and December 25, 2005 are as follows: North America International...

  • Page 63
    ... 2005, the Company purchased the assets and assumed certain liabilities of Wrebbit Inc., a Montreal-based creator and manufacturer of innovative puzzles. The purchase price was approximately $14,200. Based on the allocation of the purchase price, property rights related to acquired product lines of...

  • Page 64
    ...As of December 31, 2006, the Company is party to a receivable securitization program whereby the Company sells, on an ongoing basis, substantially all of its U.S. trade accounts receivable to a bankruptcyremote, special purpose subsidiary, Hasbro Receivables Funding, LLC (HRF), which is wholly owned...

  • Page 65
    ... elected to settle this option in the Company's stock, the Company would have been required to issue 4,078 shares. If the share price of the Company's common stock were higher as of December 31, 2006 the number of shares issuable would have decreased. If the share price were lower as of December 31...

  • Page 66
    ...accompanying consolidated statements of operations. The Company is party to interest rate swap agreements in order to adjust the amount of total debt that is subject...on the price of the Company's stock. If the closing price of the Company's stock exceeds $23.76 for at least 20 trading days, within ...

  • Page 67
    ...to Consolidated Financial Statements - (Continued) (Thousands of Dollars and Shares Except Per Share Data) day period ending on the last trading day of the calendar quarter, the holders have the right to convert the notes to shares of the Company's common stock at the initial conversion price of $21...

  • Page 68
    ... 2005 Deferred tax assets: Accounts receivable ...$ 19,287 Inventories ...17,860 Losses and tax credit carryforwards ...34,405 Operating expenses ...62,392 Pension ...27,663 Deferred compensation and stock options ...16,251 Postretirement benefits...14,128 Other ...26,453 Gross deferred tax assets...

  • Page 69
    ... until June 30, 2009, in certain merger or other business combination or recapitalization transactions, at the Right's then current exercise price, a number of the acquiring company's or Hasbro's, as the case may be, common shares having a market value at that time of twice the Right's exercise...

  • Page 70
    ... fair market value on the date the option is granted and options are adjusted for such changes as stock splits and stock dividends. Generally, options are exercisable for periods of no more than ten years after date of grant. Certain of the plans permit the granting of awards in the form of stock...

  • Page 71
    ... option awards made subsequent to the adoption date. Stock-based compensation is recognized on a straight-line basis over the requisite service period of the award. In accordance with the modified prospective transition method, the Company's consolidated financial statements for prior years have not...

  • Page 72
    ... market value at the date of grant and vested upon grant. Compensation cost of $990 was recorded in connection with this grant. (11) Pension, Postretirement and Postemployment Benefits Pension and Postretirement Benefits In September 2006, the FASB issued Statement of Financial Accounting Standards...

  • Page 73
    ..., the Company will be required under SFAS 158 to change the measurement dates for its pension plans to its fiscal year-end. Hasbro also provides certain postretirement health care and life insurance benefits to eligible employees who retire and have either attained age 65 with 5 years of service or...

  • Page 74
    ......Employer contribution ...Benefits paid ...Expenses paid ...Fair value of plan assets - ending ...Reconciliation of Funded Status Projected benefit obligation ...Fair value of plan assets ...Contributions after measurement date...Funded status ...Unrecognized net loss ...Unrecognized prior service...

  • Page 75
    ... practices, at a minimum, must comply with the Employee Retirement Income Security Act (ERISA) and any other applicable laws and regulations. The Plans' shared primary investment goal is maximum total return, consistent with prudent investment management. The Plans' asset allocations are structured...

  • Page 76
    ......4.00% 4.00% 4.00% Long-term rate of return on plan assets ...8.75% 8.75% 8.75% Hasbro works with external benefit investment specialists to assist in the development of the long-term rate of return assumptions used to model and determine the overall asset allocation. Forecast returns are based on...

  • Page 77
    ... to be included as a component of net periodic benefit cost. At December 25, 2005, the Company had recorded an additional minimum pension liability related to these international plans of $3,100. This additional minimum pension liability was partially offset by an intangible asset in the amount of...

  • Page 78
    ... as follows: 2007 ...2008 ...2009 ...2010 ...2011 ...2012-2016 ...Postemployment Benefits Hasbro has several plans covering certain groups of employees, which may provide benefits to such employees following their period of active employment but prior to their retirement. These plans include certain...

  • Page 79
    ... Hasbro had unused open letters of credit and related instruments of approximately $71,000 and $33,600 at December 31, 2006 and December 25, 2005, respectively. The Company enters into license agreements with inventors, designers and others for the use of intellectual properties in its products...

  • Page 80
    ... interactive products, tween electronic products, toy-related specialty products, traditional board games and puzzles, DVD- based games, fiction books, and trading card and role-playing games within the United States, Canada and Mexico. Within the International segment, the Company develops, markets...

  • Page 81
    ...Other Segments ...48,687 Corporate and eliminations(b) ...- Consolidated Total ...$3,151,481 2005 North America ...$2,038,556 International...988,591 Global Operations(a) ...10,612 Other Segments ...49,868 Corporate and eliminations(b) ...- Subtotal ...Stock Compensation(c) . . 3,087,627 - 8,266 23...

  • Page 82
    ... from STAR WARS related products accounted for 16% of consolidated net revenues. Information as to Hasbro's operations in different geographical areas is presented below on the basis the Company uses to manage its business. Net revenues are categorized based on location of the customer, while...

  • Page 83
    ...to Consolidated Financial Statements - (Continued) (Thousands of Dollars and Shares Except Per Share Data) Other Information Hasbro markets its products primarily to customers in the retail sector. Although the Company closely monitors the creditworthiness of its customers, adjusting credit policies...

  • Page 84
    ... Share Data) (16) Quarterly Financial Data (Unaudited) First Second Quarter Third Fourth Full Year 2006 Net revenues ...Gross profit ...Earnings (loss) before income taxes . . Net earnings (loss) ...Per common share Net earnings (loss) Basic ...Diluted ...Market price High ...Low ...Cash dividends...

  • Page 85
    ...processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms and that such information is accumulated and communicated to the Company's management, including its Chief Executive Officer and Chief Financial Officer, as appropriate to...

  • Page 86
    ...all material respects. Our audit included obtaining an understanding of internal control over financial reporting, evaluating management's assessment, testing and evaluating the design and operating effectiveness of internal control, and performing such other procedures as we considered necessary in...

  • Page 87
    ...including the Company's Chief Executive Officer, Chief Financial Officer and Controller. A copy of the Code of Conduct is available on the Company's website under Corporate Information, Investors, Corporate Governance. The Company's website address is http://www.hasbro.com. Although the Company does...

  • Page 88
    ... the caption "Governance of the Company" and "Certain Relationships and Related Transactions" in the Company's definitive proxy statement for the 2007 Annual Meeting of Shareholders and is incorporated herein by reference. Item 14. Principal Accountant Fees and Services The information required by...

  • Page 89
    ... Material Contracts (a) Lease between Hasbro Canada Corporation (formerly named Hasbro Industries (Canada) Ltd.) (''Hasbro Canada") and Central Toy Manufacturing Co. (''Central Toy"), dated December 23, 1976. (Incorporated by reference to Exhibit 10.15 to the Company's Registration Statement on Form...

  • Page 90
    ... 10-K for the Fiscal Year Ended December 28, 1997, File No. 1-6682.) Letter agreement, dated December 13, 2000, between Hasbro Canada and Central Toy. (Incorporated by reference to Exhibit 10(d) to the Company's Annual Report on Form 10-K for the Fiscal Year Ended December 31, 2000, File No. 1-6682...

  • Page 91
    ... to Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q for the period ended April 2, 2006, File No. 1-6682.) Executive Compensation Plans and Arrangements (u) 1992 Stock Incentive Plan. (Incorporated by reference to Appendix A to the Company's definitive proxy statement for its 1992 Annual...

  • Page 92
    ... for the Fiscal Year Ended December 30, 1990, File No. 1-6682.) First Amendment to Hasbro, Inc. Retirement Plan for Directors, dated April 15, 2003. (Incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the period ended June 29, 2003, File No. 1-6682.) Second...

  • Page 93
    ... File No. 1-6682.) Fourth Amendment to Hasbro, Inc. 2003 Stock Incentive Performance Plan. (Incorporated by reference to Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the period ended October 1, 2006, File No. 1-6682.) Form of Fair Market Value Stock Option Agreement under the 2003...

  • Page 94
    ....3 to the Company's Quarterly Report on Form 10-Q for the period ended October 1, 2006, File No. 1-6682.) Statement re computation of ratios Subsidiaries of the registrant Consent of KPMG LLP Certification of the Chief Executive Officer Pursuant to Rule 13a-14(a) under the Securities Exchange Act of...

  • Page 95
    ...also audited the related consolidated financial statement schedule of Valuation and Qualifying Accounts in the Form 10-K. This financial statement schedule is the responsibility of the Company's management. Our responsibility is to express an opinion on this financial statement schedule based on our...

  • Page 96
    ...590 - - - (1,080) (7,782) (3,790) $27,700 $29,800 $37,000 (a) Based on an assessment of accounts receivable, the Company made an adjustment to reduce its allowance for doubtful accounts at December 31, 2006. (b) Includes write-offs, recoveries of previous write-offs, and translation adjustments...

  • Page 97
    ... by the undersigned, thereunto duly authorized. HASBRO, INC. (Registrant) By: /s/ Alfred J. Verrecchia Alfred J. Verrecchia President and Chief Executive Officer Date: February 28, 2007 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the...

  • Page 98
    Signature Title Date /s/ Claudine B. Malone Claudine B. Malone /s/ Edward M. Philip Edward M. Philip /s/ Paula Stern Paula Stern Director February 28, 2007 Director February 28, 2007 Director February 28, 2007 87

  • Page 99
    NOTES

  • Page 100
    NOTES

  • Page 101
    NOTES

  • Page 102
    ... wish information about Hasbro are invited to contact: Investor Relations 1027 Newport Avenue P.O. Box 1059 Pawtucket, Rhode Island 02862-1059 (401) 431-8697 Internet Address: www.hasbro.com. Transfer Agent and Registrar Shareholders who wish to change the name or address on their record of stock...

  • Page 103
    Hasbro, Inc. 1027 Newpor t Avenue, Paw tucket, Rhode Island 02862-1059 w w w.hasbro.com 002CS-13731