Slide 1: Q4/FY 2023 Earnings
Q4/FY 2023 Earnings February 13, 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 net earnings and Adjusted net earnings per diluted share, which exclude,
Slide 3: Safe Harbor
Safe Harbor Certain statements in this press release 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
Slide 4: Fourth Quarter Highlights
Fourth Quarter Highlights Wizards of the Coast and Digital Gaming segment grew 7% behind continued strength of Baldur’s Gate III and Monopoly Go! REPORTED ADJUSTED Toy holiday performance in line with expectations with strong performance in $1.3B $1.3B Net Revenue FURBY, G.I. JOE and TRANSFORMERS -2
Slide 5: Full Year Highlights
Full Year Highlights Full Year revenues down 15% in line with guidance REPORTED ADJUSTED Full year growth in MAGIC: THE GATHERING, DUNGEONS & DRAGONS & $5.0B $5.0B Net Revenue TRANSFORMERS; Strong contribution from launch of FURBY -15% -15% Adjusted Operating Profit of $477M includes $130M of non-ca
Slide 6: Hasbro's Transformation: Refocus on Play
Hasbro’s Transformation: Refocus on Play Execute Blueprint 2.0 Operate with Excellence Strengthen Balance Sheet Focus on bottom line Enhance Hasbro’s Gaming performance by prioritizing Invest to drive profitable growth leadership, both tabletop and digital fewer, bigger brands Double-down on fewer,
Slide 7: Fourth Quarter and Full Year 2023
Fourth Quarter and Full Year 2023 GAME OF THE YEAR 7
Slide 8: Hasbro Inc. Fourth Quarter 2023 Performance
Hasbro Inc. Fourth Quarter 2023 Performance Wizards of Q4 2023 Reported Results Consumer Corporate the Coast & Entertainment Hasbro ($ millions, except earnings per share) Products & Other Digital Gaming Revenue $363 $754 $172 N/A $1,289 % vs PY +7% -25% -49% N/A -23% Operating Profit (Loss) $103 ($
Slide 9: Hasbro Inc. Fourth Quarter 2023 Performance-As Adjusted
Hasbro Inc. Fourth Quarter 2023 Performance-As Adjusted Wizards of Q4 2023 Adjusted Results Consumer Corporate the Coast & Entertainment Hasbro ($ millions, except earnings per share) Products & Other Digital Gaming Revenue $363 $754 $172 N/A $1,289 % vs PY +7% -25% -49% N/A -23% Operating Profit (L
Slide 10: Hasbro Inc. Full Year 2023 Performance
Hasbro Inc. Full Year 2023 Performance Wizards of FY 2023 Reported Results Consumer Corporate the Coast & Entertainment Hasbro ($ millions, except earnings per share) Products & Other Digital Gaming Revenue $1,458 $2,886 $659 N/A $5,003 % vs PY +10% -19% -31% N/A -15% Operating Profit (Loss) $526 ($
Slide 11: Hasbro Inc. Full Year 2023 Performance-As Adjusted
Hasbro Inc. Full Year 2023 Performance-As Adjusted Wizards of FY 2023 Adjusted Results Consumer Corporate the Coast & Entertainment Hasbro ($ millions, except earnings per share) Products & Other Digital Gaming Revenue $1,458 $2,886 $659 N/A $5,003 % vs PY +10% -19% -31% N/A -15% Operating Profit (L
Slide 12: Brand Portfolio Performance
Brand Portfolio Performance Q4 and Full Year 2023 Brand Category Highlights Net Revenue by Brand Portfolio Franchise Brands ($ millions) Q4 2023 Q4 2022 % Change FY 2023 FY 2022 % Change Fourth quarter and full year growth in DUNGEONS & DRAGONS (+54% and +76%, Franchise Brands $844 $935 -10% $3,257
Slide 13: Hasbro Full Year 2023 Share in Focus Categories
Hasbro Full Year 2023 Share in Focus Categories Focus Categories – FY 2023 Action Figures & Accessories TRANSFORMERS POS growth for Hasbro Hasbro Hasbro the full year Focus Category Share Change Share Position Arts & Crafts Full year growth in PLAY-DOH Action Figures & Accessories +0.5 pts 23.4% 1 P
Slide 14: Q4 2023 Operating Margin Performance
Q4 2023 Operating Margin Performance As Reported Operating Profit Margin Drivers Adjusted Operating Profit Margin Drivers ($ millions) ($ millions) Q4 2022 Op Profit Margin Q4 2022 Op Profit Margin -7.5% ($126) 16.0% $269 (Adjusted) Volume & Mix* -12.3 pts ($130) Volume & Mix* -5.3pts ($130) Royalti
Slide 15: FY 2023 Operating Margin Performance
FY 2023 Operating Margin Performance As Reported Operating Profit Margin Drivers Adjusted Operating Profit Margin Drivers ($ millions) ($ millions) FY 2022 Op Profit Margin FY 2022 Op Profit Margin 7.0% $408 15.8% $923 (Adjusted) Volume & Mix* -4.5 pts ($285) Volume & Mix* -3.1 pts ($285) Royalties
Slide 16: Total Hasbro Owned Inventory Reduction
Total Hasbro Owned Inventory Reduction Total inventory down 51% vs. 2022 -26% improving overall network health • CP down 56% -51% • Wizards down 30% $677 $552 Total non-recurring charge of $130M taken in Q4 $446 $396 $332 Retail inventory down ~20% Reduced complexity by eliminating 2019 2020 2021 20
Slide 17: Consumer Products Performance
Consumer Products Performance Q4 2023 Revenue Bridge FY 2023 Revenue Bridge License Toy & Game Toy & Game 1.3% Exits Volume Rate/Mix Total License Toy & Game Toy & Game Exits Volume Rate/Mix 0.3% 0.3% Total -0.3% Licensed FX Licensed -2.5% FX CP CP -4.7% -3.9% -3.6% -12.6% -18.7% -25% -19% Key Busin
Slide 18: Wizards of the Coast & Digital Gaming Segment Performance
Wizards of the Coast & Digital Gaming Segment Performance Q4 2023 Revenue Bridge FY 2023 Revenue Bridge +10.0% 8.5% +7.1% 7.5% 1.0% 2.1% 0.1% 0.2% -1.3% -1.0% Digital Digital FX Total Wizards Digital Wizards Gaming Digital Games Tabletop Gaming Tabletop Licenses Games FX Total Licenses Key Business
Slide 19: 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 20: Total Hasbro, Inc. Cash Flow and Metrics
Total Hasbro, Inc. Cash Flow and Metrics Other 2023 Highlights • Reduced debt by $506M FY 2023, Operating Cash Flow including all variable debt • Adjusted Underlying FY Tax Rate of $726 27.9% vs. 21.8% prior year • Total working capital improvement of $350M primarily driven by inventory reduction $3
Slide 21: 2024 Guidance
2024 Guidance 2024 Headlines: • CP Revenue outlook impacted by business exits and industry outlook Wizards of the Coast & Consumer Products Digital Gaming • WOTC Revenue decline in back-half driven by strong digital game comparison -3 to -5% -7 to -12% Revenue Decline Revenue Decline • Pro-forma Ent
Slide 22: Operational Excellence Program
Operational Excellence Program Cumulative Gross Cost Savings • Mid-term gross savings target $750 $230 • Increased to $750M from $350–$400M $250 • Expect approximately ~50% of gross savings to flow through to bottom line $220 • $83M cost to achieve as of year end 2023 $20 ($ millions) 22
Slide 23: Supplemental Financial Information
Supplemental Financial Information
Slide 24: Hasbro Q4 Share in Focus Categories
Hasbro Q4 Share in Focus Categories Focus Categories – Q4 2023 Hasbro Hasbro Hasbro Focus Category Action Figures & Accessories Share Change Share Position TRANSFORMERS POS growth in the quarter Action Figures & Accessories -0.3 pts 22.9% 1 Arts & Crafts Fourth quarter growth in PLAY-DOH POS Arts &
Slide 25: Condensed Consolidated Balance Sheets
Condensed Consolidated Balance Sheets 25
Slide 26: Condensed Statements of Operations
Condensed Statements of Operations 26
Slide 27: Condensed Consolidated Cash Flows
(MILLIONS OF DOLLARS) (UNAUDITED) Condensed Consolidated Cash Flows 27
Slide 28: Fourth Quarter 2023 Major Expense Items
$ MILLIONS, UNAUDITED Fourth Quarter 2023 Major Expense Items Q4 2023 % CHANGE Adjusted* NOTES Q4 2023 Q4 2022 Adjusted* % OF Below exclude non-GAAP Q4 2023 Adjusted* Q4 2022 Adjusted* YOY REVENUE adjustments Increased obsolescence in Cost of Sales $574 $574 $581 $566 +2% 44.5% Consumer Products and
Slide 29: Full Year 2023 Major Expense Items
$ MILLIONS, UNAUDITED Full Year 2023 Major Expense Items Full Year 2023 Full Year Full Year % CHANGE Adjusted* NOTES Full Year 2023 Full Year 2022 Adjusted* % OF Below exclude non-GAAP 2023 Adjusted* 2022 Adjusted* YOY REVENUE adjustments Decline due closeouts and obsolescence within Consumer Cost o
Slide 30: Key Cash Flow and Balance Sheet Data
Key Cash Flow and Balance Sheet Data $ Millions, unaudited YTD 2023 YTD 2022 NOTES Cash $545 $513 Long-term Debt $2,966 $3,711 Reduced debt by $506M in FY 2023 Depreciation $128 $127 FY 2023 depreciation target in line with FY 2022 Reflects POWER RANGERS impairment charge in Q4 2022: classification
Slide 31: Segment Results-As Reported and As Adjusted-Q4 2023
(UNAUDITED) (MILLIONS OF DOLLARS) Segment Results-As Reported and As Adjusted-Q4 2023 31
Slide 32: Segment Results-As Reported and As Adjusted-Q4 2023 Continued
(UNAUDITED) (MILLIONS OF DOLLARS) Segment Results-As Reported and As Adjusted-Q4 2023 Continued 32
Slide 33: Segment Results-As Reported and As Adjusted-Q4 2023 Continued
(UNAUDITED) (MILLIONS OF DOLLARS) Segment Results-As Reported and As Adjusted-Q4 2023 Continued 33
Slide 34: Segment Results-As Reported and As Adjusted-Full Year 2023
(UNAUDITED) (MILLIONS OF DOLLARS) Segment Results-As Reported and As Adjusted-Full Year 2023 34
Slide 35: Segment Results-As Reported and As Adjusted-Full Year 2023 Continued
(UNAUDITED) (MILLIONS OF DOLLARS) Segment Results-As Reported and As Adjusted-Full Year 2023 Continued 35
Slide 36: Segment Results-As Reported and As Adjusted-Full Year 2023 Continued
(UNAUDITED) (MILLIONS OF DOLLARS) Segment Results-As Reported and As Adjusted-Full Year 2023 Continued 36
Slide 37: Reconciliation of Non-GAAP Financial Measures
(UNAUDITED) (MILLIONS OF DOLLARS) Reconciliation of Non-GAAP Financial Measures 37
Slide 38: Reconciliation of Non-GAAP Financial Measures continued
(UNAUDITED) (MILLIONS OF DOLLARS) Reconciliation of Non-GAAP Financial Measures continued 38
Slide 39: Reconciliation of Non-GAAP Financial Measures
(UNAUDITED) (MILLIONS OF DOLLARS) EBITDA Reconciliation of Non-GAAP Financial Measures 39
Slide 40: Reconciliation of Non-GAAP Financial Measures
(UNAUDITED) (MILLIONS OF DOLLARS AND SHARES, EXCEPT PER SHARE DATA) Reconciliation of Non-GAAP Financial Measures 40