Hasbro 2007 Annual Report Download - page 2

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To Our Shareholders
Products Shown:
Are You Smarter Than A 5th Grader?
Transformers® Bumblebee™
Turbo Tooth Tunes™ Toothbrush
Littlest Pet Shop® VIPs
There is no better mission in life than “Making the World Smile!” At Hasbro, our
business is built on fun, and our nearly 6,000 employees worldwide are all focused
on bringing joy and exciting play experiences to millions of kids and families across
the globe. You can see this commitment and passion in everything we do --- from
the toys, games and licensed products we bring to market, to how we manage our
business, and create value for our shareholders. As you read about all of the great things
happening within your company, we hope that Hasbro brings out the kid in all of you and that
you continue to personally discover the magic within our brands!
2007 Highlights
In 2007, Hasbro had a very strong year and delivered record-breaking results, in spite of the
challenges facing the toy industry.
We started 2007 strong, performed well throughout the year, and fi nished with a robust fourth quarter,
even though the industry saw a holiday season that was negatively affected by a weak retail environment
and the impact of the lead paint recalls. We were proud that Hasbro avoided any lead paint recalls ---
a tribute to our commitment to product safety. Our growth was broad based, both in terms of geography and product
categories, and we continued to drive innovation in all aspects of our business. All in all, Hasbro had an extraordinary year!
We have accomplished a great deal over the past six years --- growing revenues at a compounded annual growth rate
of over 6%, surpassing our longer-term goal of 3-5% per year, and achieving an operating margin of 13.5%,
also exceeding our target of 12% or better, set several years ago.
Financial Results
In 2007, Hasbro reached new fi nancial milestones. We delivered our third consecutive year of record net earnings, which
totaled $333 million, an increase of over $100 million compared to 2006’s record net earnings of $230.1 million.
We increased earnings per share 53% to $1.97, resulting in our seventh consecutive year of net earnings
and earnings per share growth.
Worldwide net revenues grew 22% to $3.8 billion, an increase of $686.1 million, compared to $3.2 billion a year ago,
refl ecting the success we have had in growing our core brands, particularly TRANSFORMERS and
LITTLEST PET SHOP. Our operating profi t improved 38% to $519.4 million or 13.5% of net revenues.
In recognition of our strong fi nancial performance and our commitment to creating value for our
shareholders, in February 2008, the Board of Directors declared a quarterly cash dividend,
payable in May, of $0.20 per common share, an increase of $0.04 per share or 25%
from the previous quarterly dividend of $0.16 per common share.
Also in February of 2008, the Board of Directors
authorized the Company to repurchase an
additional $500 million in common stock.