Hasbro 2010 Annual Report Download - page 11

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PART I
Item 1. Business
General Development and Description of Business and Business Segments
Except as expressly indicated or unless the context otherwise requires, as used herein, “Hasbro”, the
“Company”, “we”, or “us”, means Hasbro, Inc., a Rhode Island corporation organized on January 8, 1926, and
its subsidiaries. Unless otherwise specifically indicated, all dollar or share amounts herein are expressed in
thousands of dollars or shares, except for per share amounts.
Overview
We are a worldwide leader in children’s and family leisure time products and services with a broad
portfolio of brands and entertainment properties. As a branded play, consumer-focused global company, Hasbro
applies its brand blueprint to all of its operations. The brand blueprint revolves around the objective of
continuously re-imagining, re-inventing, and re-igniting our brands through a wide range of innovative toys
and games, entertainment offerings, including television programming and motion pictures, and licensed
products, ranging from traditional to high-tech and digital, under well-known brand names such as TRANS-
FORMERS, PLAYSKOOL, NERF, LITTLEST PET SHOP, MY LITTLE PONY, G.I. JOE, TONKA, MILTON
BRADLEY, PARKER BROTHERS, CRANIUM and WIZARDS OF THE COAST. Our offerings encompass a
broad variety of games, including traditional board, card, hand-held electronic, trading card, role-playing and
DVD games, as well as electronic learning aids and puzzles. Toy offerings include boys’ action figures,
vehicles and playsets, girls’ toys, electronic toys, plush products, preschool toys and infant products, electronic
interactive products, creative play and toy related specialty products. In addition, in order to further expand
our brands, we license certain of our trademarks, characters and other property rights to third parties for use in
connection with digital gaming, consumer promotions, and for the sale of non-competing toys and games and
non-toy products. We also seek to expand awareness of our brands through immersive entertainment
experiences, including television and movies. We own a 50% interest in a joint venture with Discovery
Communications, Inc. (“Discovery”) that operates a television network in the United States, THE HUB,
dedicated to high-quality children’s and family entertainment and educational programming. Hasbro Studios,
our wholly-owned production studio, produces television programming primarily based on our brands for
distribution on THE HUB in the United States and for distribution on other networks internationally.
Product Categories
We market our brands under the following primary product categories: (1) boys’ toys; (2) games and
puzzles; (3) girls’ toys; and (4) preschool toys. Descriptions of these product categories are as follows:
Our boys’ toys category includes a wide range of core brand offerings such as TRANSFORMERS and
G.I. JOE action figures and accessories, NERF sports and action products, as well as entertainment-based
licensed products based on popular movie, television and comic book characters, such as STAR WARS and
MARVEL toys and accessories. In the action figure area, a key part of our strategy focuses on the importance
of reinforcing the storyline associated with these products through the use of media-based entertainment. In
2010, sales in our boys’ toys category also benefited from the major motion picture release of IRON MAN 2.
In addition, STAR WARS and SPIDER-MAN products were each supported by animated television series. In
2011, the major motion pictures TRANSFORMERS: DARK OF THE MOON, based on our TRANSFORMERS
property, and THOR and CAPTAIN AMERICA: THE FIRST AVENGER, from MARVEL, are expected to be
released. In addition to marketing and developing action figures and accessories for traditional play, the
Company also develops and markets products designed for collectors, which has been a key component of the
success of the STAR WARS brand. Other key boys’ brands include TONKA trucks and playsets, BEYBLADE
tops and accessories and SUPERSOAKER water squirting toys.
Our games and puzzles category includes several well known lines, including MILTON BRADLEY,
PARKER BROTHERS, CRANIUM, AVALON HILL and WIZARDS OF THE COAST. These brand portfolios
consist of a broad assortment of games for children, tweens, families and adults. Core game brands include
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