Slide 1: Q3 2024 Earnings
Q3 2024 Earnings October 24, 2024
Slide 2: Use of Non-GAAP Financial Measures
USE OF NON-GAAP FINANCIAL MEASURES Supplemental Financial Data The financial tables accompanying this presentation include non-GAAP financial measures as defined under SEC rules, specifically Adjusted operating profit, Adjusted operating margin, Adjusted net earnings and Adjusted net earnings per di
Slide 3: Safe Harbor
Safe Harbor Certain statements in this presentation contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements, which may be identified by the use of forward-looking words or phrases, include statements relating to our business s
Slide 4: Hasbro's Transformation
Hasbro’s Transformation Focus on Play Operate with Excellence Strengthen Balance Sheet Focus on bottom line Enhance Hasbro’s Gaming performance by prioritizing Invest to drive profitable growth leadership, both tabletop and digital fewer, bigger brands Double-down on fewer, Deliver Operational Excel
Slide 5: Third Quarter 2024 Highlights
Third Quarter 2024 Highlights Total Hasbro revenue decline of 15%; Revenues declined 9% excluding the eOne divestiture REPORTED ADJUSTED Despite growth in MAGIC, Wizards segment -5% due to the lap of Baldur’s Gate 3 $1,281M $1,281M Net Revenue -15% -15% Consumer Products declined 10% due to exited b
Slide 6: Nine Months 2024 Highlights
Nine Months 2024 Highlights Total Hasbro revenue decline of 18%; Revenues declined 8% excluding the eOne divestiture REPORTED ADJUSTED Wizards of the Coast and Digital Gaming segment grew 7% behind growth in $3,034M $3,034M Net Revenue MAGIC: THE GATHERING and Licensed and Digital Gaming -18% -18% $
Slide 7: Third Quarter 2024 Highlights & Announcements
Third Quarter 2024 Highlights & Announcements
Slide 8: Hasbro, Inc. Third Quarter 2024 Performance
Hasbro, Inc. Third Quarter 2024 Performance Wizards of Q3 2024 Reported Results Consumer Entertainment Corporate the Coast & Hasbro ($ millions, except earnings per share) Products & Other Digital Gaming Revenue $404 $860 $17 N/A $1,281 % vs PY -5% -10% -86% N/A -15% Operating Profit (Loss) $181 $12
Slide 9: Hasbro, Inc. Third Quarter 2024 Performance-As Adjusted
Hasbro, Inc. Third Quarter 2024 Performance-As Adjusted Wizards of Q3 2024 Adjusted Results Consumer Corporate the Coast & Entertainment Hasbro ($ millions, except earnings per share) Products & Other Digital Gaming Revenue $404 $860 $17 N/A $1,281 % vs PY -5% -10% -86% N/A -15% Operating Profit $18
Slide 10: Hasbro, Inc. Nine Months 2024 Performance
Hasbro, Inc. Nine Months 2024 Performance Nine Months 2024 Reported Wizards of Consumer Entertainment Corporate Results the Coast & Hasbro Products & Other ($ millions, except earnings per share) Digital Gaming Revenue $1,172 $1,798 $64 N/A $3,034 % vs PY +7% -16% -87% N/A -18% Operating Profit $551
Slide 11: Hasbro, Inc. Nine Months 2024 Performance-As Adjusted
Hasbro, Inc. Nine Months 2024 Performance-As Adjusted Wizards of Q3 2024 Adjusted Results Consumer Corporate the Coast & Entertainment Hasbro ($ millions, except earnings per share) Products & Other Digital Gaming Revenue $1,172 $1,798 $64 N/A $3,034 % vs PY +7% -16% -87% N/A -18% Operating Profit $
Slide 12: Q3 2024 Operating Margin Performance
Q3 2024 Operating Margin Performance As Reported Operating Margin Drivers Adjusted Operating Margin Drivers ($ millions) Amounts may not sum due to rounding ($ millions) Amounts may not sum due to rounding Q3 2023 Op Margin -11.3% ($170) Q3 2023 Op Margin (Adjusted) 22.8% $343 Volume & Mix* -1.7 pts
Slide 13: YTD 2024 Operating Margin Performance
YTD 2024 Operating Margin Performance As Reported Operating Margin Drivers Adjusted Operating Margin Drivers ($ millions) Amounts may not sum due to rounding ($ millions) Amounts may not sum due to rounding YTD 2023 Op Margin -9.2% ($340) YTD 2023 Op Margin (Adjusted) 14.2% $527 Volume & Mix* -0.2 p
Slide 14: Total Hasbro Owned Inventory Reduction
Total Hasbro Owned Inventory Reduction • Total Q3 owned inventory -39% Down -36% vs. Q3 2019 YoY; increase vs. Q2 driven by planned inventory build ahead of holidays $845 • Current inventory represents $618 ~90 days of supply, down 30% $589 +5% versus last year; Aged inventory at all time lows $358
Slide 15: Wizards of the Coast & Digital Gaming Revenue Drivers
Wizards of the Coast & Digital Gaming Revenue Drivers 1% 1% 0.2% Q3 -5% -7% Wizards Analog Wizards Digital Digital Gaming FX Total Revenue Decline Licensing 7% 4% 2% YTD 1% - Wizards Analog Wizards Digital Digital Gaming FX Total Revenue Growth Licensing Wizards Tabletop represents tabletop MAGIC: T
Slide 16: Wizards of the Coast Op Margin Performance
Wizards of the Coast Op Margin Performance Q3 YTD • Q3 Margin impacted by Baldur’s Gate 3 launch in 2023 Op Margin (Adjusted) 48.0% $204 38.6% $423 2023 Volume & Mix* -2.8 pts ($21) +3.6 pts $76 • Business mix shift to digital driving margin improvement Gross Sales to Net Sales Rate -0.2 pts ($1) -0
Slide 17: Consumer Products Revenue Drivers
Consumer Products Revenue Drivers 3% -1% -1% Q3 -2% -9% -10% Exited Business Volume & Mix Selling Rate Licensing FX Total Revenue Decline 2% YTD -2% -1% -1% -14% -16% Exited Business Volume & Mix Selling Rate Licensing FX Total Revenue Decline Volume/Mix represents gross sales volume impact to opera
Slide 18: Brand Portfolio Performance
Brand Portfolio Performance Q3 2024 Brand Category Net Revenue by Brand Portfolio Highlights Franchise Brands ($ millions) Q3 2024 Q3 2023 % Change YTD 2024 YTD 2023 % Change Third quarter growth in HASBRO GAMING (+6%), MAGIC THE GATHERING (+3%), TRANSFORMERS (+5%) offset by declines in Franchise Br
Slide 19: Consumer Products Op Margin Performance
Consumer Products Op Margin Performance Q3 YTD • Underlying operating margin 2023 Op Profit Margin (Adjusted) 11.2% $107 4.4% $94 growth driven by supply chain performance, improved cost Volume & Mix* -2.5 pts ($28) -4.8 pts ($101) structure and fewer closeouts Gross Sales to Net Sales Rate +0.8 pts
Slide 20: Total Hasbro, Inc. Cash Flow and Metrics
Total Hasbro, Inc. Cash Flow and Metrics Q3 2024 Highlights Operating Cash Flow • Operating cash improvement of $253M year to date driven by improved operating results and net working capital $588 • Capital spending down slightly vs. PY due to project timing $335 • Adjusted Underlying Q3 Tax Rate of
Slide 21: Updated 2024 Guidance
Updated 2024 Guidance Revised Annual Guidance: • Wizards Revenue guidance raised behind strength in MAGIC: THE GATHERING and Monopoly Go! Wizards of the Coast & Consumer Products Digital Gaming • Consumer Products updated revenue range reflects lower close out volume and softness in select brands in
Slide 22: Operational Excellence Program
Operational Excellence Program Path to $750M of Gross Cost Savings • Delivered $240M of gross $750M savings YTD 2024; annual Approx. Net Savings planned gross savings of $300M • Realized ~$177M of net cost savings year to date driven by Supply Chain and Operational $300M Excellence savings $220M $21
Slide 23: Supplemental Financial Information
Supplemental Financial Information
Slide 24: Gross Margin Performance
Gross Margin Performance • Q3 Gross Margin improvement Q3 YTD of +7.2 pts • Underlying Gross Margin drivers: Q3 2023 Gross Margin 62.6% $941 60.8% $2,257 • Supply Chain productivity Volume & Mix* +1.7 pts ($35) +3.0 pts ($37) • lower closeout sales • shift in business mix to COS Savings > Cost Infla
Slide 25: Condensed Consolidated Balance Sheets
Condensed Consolidated Balance Sheets 25
Slide 26: Consolidated Statement of Operations
Consolidated Statement of Operations 26
Slide 27: Condensed Consolidated Statement of Cash Flows
Condensed Consolidated Statement of Cash Flows 27
Slide 28: Hasbro Q3 Share in Focus Categories
Hasbro Q3 Share in Focus Categories Focus Categories – Q3 2024 Action Figures & Accessories Lapping 2023 Entertainment; Q3 Hasbro Hasbro Hasbro POS increases in Marvel Classic & Focus Category Share Change Share Position Spidey and His Amazing Friends Arts & Crafts Action Figures & Accessories -1.6
Slide 29: Hasbro YTD Share in Focus Categories
Hasbro YTD Share in Focus Categories Focus Categories – YTD 2024 Action Figures & Accessories Lapping 2023 entertainment Hasbro Hasbro Hasbro Focus Category calendar Share Change Share Position Arts & Crafts Action Figures & Accessories -2.5 pts 23.6% 1 PLAY-DOH POS growth year to date Games* HASBRO
Slide 30: Key Cash Flow and Balance Sheet Data
Key Cash Flow and Balance Sheet Data $ Millions, unaudited YTD 2024 YTD 2023 NOTES Cash & Short-Term $1,185 $186 $500M proceeds from May 2024 bond deal; will use to repay November 2024 maturity Investments Current and Long-Term $3,963 $3,715 $500M to be repaid in November 2024 with proceeds from rec
Slide 31: FY 2023 Entertainment Segment Financials
FY 2023 Entertainment Segment Financials $ Millions; Unaudited Financials Hasbro Entertainment Total Entertainment Divested Film & TV Assets (Remain Co) Segment Revenue $573M $86M $659M % vs. LY -30% -34% -31% Operating Profit (Loss) ($836M) ($1,075M) ($1,912M) Adjusted Operating Profit (Loss) ($40M
Slide 32: Segment Results-As Reported and As Adjusted-Q3 2024
Segment Results-As Reported and As Adjusted-Q3 2024 32
Slide 33: Segment Results-As Reported and As Adjusted-Q3 2024 Continued
Segment Results-As Reported and As Adjusted-Q3 2024 Continued (UNAUDITED) (MILLIONS OF DOLLARS) 33
Slide 34: Segment Results-As Reported and As Adjusted-YTD 2024
Segment Results-As Reported and As Adjusted-YTD 2024 34
Slide 35: Segment Results-As Reported and As Adjusted-YTD 2024
Segment Results-As Reported and As Adjusted-YTD 2024 35
Slide 36: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures (UNAUDITED) (MILLIONS OF DOLLARS) 36
Slide 37: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures (UNAUDITED) (MILLIONS OF DOLLARS) 37
Slide 38: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures 38
Slide 39: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Net Earnings and Earnings Per Share Continued….. 39