Hasbro 2014 Annual Report Download - page 58

Inventories decreased to $339,572 at December 28, 2014 from $348,794 at December 29, 2013. The
inventory balance at December 28, 2014 includes a decrease of approximately $35,700 resulting from foreign
currency translation. Absent the impact of foreign currency translation, inventories grew 8% compared to 2013.
Inventory in the International segment increased approximately 32% absent foreign currency translation
reflecting growth in the International segment, including emerging markets. Higher inventories in the
International segment were partially offset by lower inventories in the U.S. and Canada segment, which declined
23%. Inventories increased approximately 12% in 2013 from $316,049 at December 30, 2012 inclusive of a
decrease of approximately $4,400 resulting from foreign currency translation. Inventory in the International
segment increased approximately 16%, primarily due to higher balances in emerging markets, including Russia
and Brazil, supporting growth experienced in these markets. Inventory in the U.S. and Canada segment increased
2% in 2013 compared to 2012.
Prepaid expenses and other current assets increased to $391,688 at December 28, 2014 from $355,594 at
December 29, 2013. The prepaid expenses and other current assets balance at December 28, 2014 includes a
decrease of approximately $11,300 resulting from the translation of foreign currency. Absent the impact of
foreign exchange, prepaid expenses and other current assets increased approximately 13% compared to 2013,
primarily due to higher favorable balances related to foreign currency hedging contracts and increased prepaid
income taxes. These increases were only partially offset by lower prepaid royalties, primarily related to
MARVEL, and lower deferred income taxes. Prepaid expenses and other current assets increased to $355,594 at
December 29, 2013 from $312,493 at December 30, 2012. Higher prepaid royalties, primarily related to the
Company’s amended agreements with Disney related to its MARVEL and STAR WARS licenses, contributed to
increased balances in 2013 compared to 2012. Prepaid expenses and other current assets also included
approximately $3,200 related to a forward-starting interest rate swap contract which hedged future interest
payments of the May 2014 debt issuance. These increases were partially offset by lower non-income based tax
receivables, primarily value added taxes in Europe, compared to 2012 as a result of collections in 2013.
Other assets decreased approximately 8% to $657,587 at December 28, 2014 from $715,227 at
December 29, 2013. The balance at December 28, 2014 includes a decrease of approximately $9,900 resulting
from the translation of foreign currencies. Absent translation, the decrease primarily relates to the partial sale of
the Company’s investment in the Network and, to a lesser extent, lower long-term prepaid royalties which have
been reclassified from non-current to current or have been earned. These decreases were partially offset by
higher favorable balances related to foreign currency hedging contracts and higher deferred income taxes relating
to higher pension liabilities and the partial sale of the Company’s investment in the Network. Other assets
increased to $715,227 at December 29, 2013 from $695,187 at December 30, 2012. The increase in 2013
compared to 2012 primarily reflects higher long-term prepaid royalties related to the Company’s amended
agreements with Disney for STAR WARS and MARVEL licenses. These increases were only partially offset by
lower television programming assets and lower deferred income taxes relating to lower pension liabilities in 2013
compared to 2012.
Accounts payable and accrued expenses decreased approximately 11% to $822,453 at December 28, 2014
from $926,558 at December 29, 2013. The balance at December 28, 2014 included a decrease of approximately
$18,900 resulting from the translation of foreign currencies. The decrease was primarily due to lower accrued
royalties and accrued interest, primarily resulting from the payment amounts accrued at the end of 2013 related to
the settlement of an adverse arbitration award as well as lower accrued severance due to scheduled payments.
Accounts payable and accrued expenses increased to $926,558 at December 29, 2013 from $736,070 at
December 30, 2012. The balance includes a decrease of approximately $6,300 resulting from the translation of
foreign currency. Higher accrued royalties, interest and dividends as well as higher accounts payable contributed
to the increase in accounts payable and accrued expenses in 2013 compared to 2012. These increases included
accrued royalties of $42,950 and accrued interest of $15,090 related to the settlement of an adverse arbitration
award. Higher accrued dividends reflected a decision by the Company’s Board in 2012 to accelerate the payment
of the dividend declared in December 2012 from February 2013 to December 2012. As such, there were no
accrued dividends at December 30, 2012.
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