NEW YORK (Reuters) - Hasbro Inc (HAS.O), maker of Nerf foam toys and Transformers action figures, promised investors a “meaningful” rise in 2011 sales and earnings, despite missing profit estimates in the second quarter on higher costs.
The news came just days after larger rival Mattel Inc (MAT.O) beat quarterly profit and sales estimates on strong sales of its Barbie dolls and toys based on the “Cars 2” movie. Hasbro shares were down 0.3 percent at $41.25 in premarket trading on Monday.
Hasbro has been spending more in recent quarters to boost its overseas presence and develop its new television channel, The Hub. It is also battling rising costs of plastics, packaging paper, freight and labor.
The company is counting on its overseas investments and strong product line-up heading into the key holiday selling season to help boost revenue and sales in 2011.
This year, Hasbro began marketing toys based on movies such as “Transformers: Dark of the Moon” and “Thor.” It is also making products based on “Captain America: the First Avenger,” which is set to hit theaters this week.
In the third quarter, the company will introduce its new Kre-O construction brand internationally and add Sesame Street-branded toys to its preschool business.
In the second quarter, Hasbro’s net profit rose to $58.1 million, or 42 cents a share, from $43.6 million, or 29 cents a share, a year earlier.
Excluding items, earnings were 33 cents a share, missing the analysts’ average estimate of 39 cents, according to Thomson Reuters I/B/E/S.
Net revenue rose 23 percent to $908.5 million, beating the analysts’ average estimate of $854.8 million.
Reporting by Dhanya Skariachan; Editing by Lisa Von Ahn