Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Apr. 02, 2017 | Apr. 24, 2017 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | HASBRO INC | |
Entity Central Index Key | 46,080 | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | Yes | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 125,003,385 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Apr. 2, 2017 | |
Trading Symbol | HAS |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Apr. 02, 2017 | Dec. 25, 2016 | Mar. 27, 2016 |
Current assets | |||
Cash and cash equivalents | $ 1,463,081 | $ 1,282,285 | $ 1,095,880 |
Accounts receivable, less allowance for doubtful accounts of $13,200, $16,800 and $31,100 as of April 2, 2017, December 25, 2016 and March 27, 2016, respectively | 676,945 | 1,319,963 | 670,663 |
Inventories | 416,232 | 387,675 | 461,734 |
Prepaid expenses and other current assets | 243,475 | 237,684 | 295,806 |
Total current assets | 2,799,733 | 3,227,607 | 2,524,083 |
Property, plant and equipment, less accumulated depreciation of $392,900, $383,700 and $365,600 as of April 2, 2017, December 25, 2016 and March 27, 2016, respectively | 270,023 | 267,398 | 241,253 |
Other assets | |||
Goodwill | 570,937 | 570,555 | 592,793 |
Other intangibles, net, accumulated amortization of $883,900, $876,000 and $850,000 as of April 2, 2017, December 25, 2016 and March 27, 2016, respectively | 238,069 | 245,949 | 272,116 |
Other | 767,108 | 779,857 | 734,450 |
Total other assets | 1,576,114 | 1,596,361 | 1,599,359 |
Total assets | 4,645,870 | 5,091,366 | 4,364,695 |
Current liabilities | |||
Short-term borrowings | 65,294 | 172,582 | 89,000 |
Current portion of long-term debt | 349,814 | 349,713 | 0 |
Accounts payable | 241,214 | 319,525 | 176,665 |
Accrued liabilities | 545,492 | 776,039 | 502,708 |
Total current liabilities | 1,201,814 | 1,617,859 | 768,373 |
Long-term debt | 1,198,896 | 1,198,679 | 1,547,434 |
Other liabilities | 393,516 | 389,388 | 402,346 |
Total liabilities | 2,794,226 | 3,205,926 | 2,718,153 |
Redeemable noncontrolling interests | 0 | 22,704 | 39,152 |
Shareholders' equity | |||
Preference stock of $2.50 par value. Authorized 5,000,000 shares; none issued | 0 | 0 | 0 |
Common stock of $.50 par value. Authorized 600,000,000 shares; issued 209,694,630 at April 2, 2017, December 25, 2016, and March 27, 2016 | 104,847 | 104,847 | 104,847 |
Additional paid-in capital | 1,008,737 | 985,418 | 906,211 |
Retained earnings | 4,145,469 | 4,148,722 | 3,837,372 |
Accumulated other comprehensive loss | (197,171) | (194,570) | (164,353) |
Treasury stock, at cost; 84,685,145 shares at April 2, 2017; 85,207,677 shares at December 25, 2016; and 84,829,514 shares at March 27, 2016 | (3,210,238) | (3,181,681) | (3,076,687) |
Total shareholders' equity | 1,851,644 | 1,862,736 | 1,607,390 |
Total liabilities, redeemable noncontrolling interests and shareholders' equity | $ 4,645,870 | $ 5,091,366 | $ 4,364,695 |
Consolidated Balance Sheets (U3
Consolidated Balance Sheets (Unaudited) Parenthetical - USD ($) $ in Thousands | Apr. 02, 2017 | Dec. 25, 2016 | Mar. 27, 2016 |
Current assets | |||
Accounts receivable, allowance for doubtful accounts | $ 13,200 | $ 16,800 | $ 31,100 |
Property, plant and equipment, accumulated depreciation | 392,900 | 383,700 | 365,600 |
Other assets | |||
Other intangibles, accumulated amortization | $ 883,900 | $ 876,000 | $ 850,000 |
Shareholders' equity | |||
Preference stock, par value (in dollars per share) | $ 2.5 | $ 2.5 | $ 2.5 |
Preference stock, authorized shares (in shares) | 5,000,000 | 5,000,000 | 5,000,000 |
Preference stock, issued (in shares) | 0 | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.5 | $ 0.5 | $ 0.5 |
Common stock, authorized shares (in shares) | 600,000,000 | 600,000,000 | 600,000,000 |
Common stock, issued (in shares) | 209,694,630 | 209,694,630 | 209,694,630 |
Treasury stock, at cost; shares (in shares) | 84,685,145 | 85,207,677 | 84,829,514 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2017 | Mar. 27, 2016 | |
Consolidated Statements of Operations (Unaudited) [Abstract] | ||
Net revenues | $ 849,663 | $ 831,180 |
Costs and expenses | ||
Cost of sales | 306,082 | 290,240 |
Royalties | 64,380 | 69,969 |
Product development | 62,586 | 57,164 |
Advertising | 80,936 | 79,859 |
Amortization of intangibles | 7,881 | 8,691 |
Program production cost amortization | 5,570 | 6,186 |
Selling, distribution and administration | 243,885 | 233,155 |
Total costs and expenses | 771,320 | 745,264 |
Operating Profit | 78,343 | 85,916 |
Non-operating (income) expense | ||
Interest Expense | 24,456 | 24,044 |
Interest income | (5,564) | (2,213) |
Other (income) expense, net | (11,386) | 4,872 |
Total non-operating expense, net | 7,506 | 26,703 |
Earnings before income taxes | 70,837 | 59,213 |
Income tax expense | 2,238 | 12,242 |
Net earnings | 68,599 | 46,971 |
Net loss attributable to noncontrolling interests | 0 | (1,780) |
Net Earnings Attributable to Hasbro, Inc. | $ 68,599 | $ 48,751 |
Net earnings attributable to Hasbro, Inc. per common share: | ||
Basic (in dollars per share) | $ 0.55 | $ 0.39 |
Diluted (in dollars per share) | 0.54 | 0.38 |
Cash dividends declared per common share (in dollars per share) | $ 0.57 | $ 0.51 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Earnings - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2017 | Mar. 27, 2016 | |
Consolidated Statements of Comprehensive Earnings [Abstract] | ||
Net earnings | $ 68,599 | $ 46,971 |
Other comprehensive earnings (loss): | ||
Foreign currency translation adjustments | 24,673 | 12,140 |
Net gains (losses) on cash flow hedging activities, net of tax | (23,317) | (15,786) |
Unrealized holding (losses) gains on available-for-sale securities, net of tax | (31) | 1,680 |
Reclassifications to earnings, net of tax: | ||
Net (gains) losses on cash flow hedging activities | (5,374) | (17,561) |
Unrecognized pension and postretirement amounts | 1,448 | 1,175 |
Total other comprehensive earnings (loss), net of tax | (2,601) | (18,352) |
Comprehensive earnings | 65,998 | 28,619 |
Comprehensive loss attributable to noncontrolling interests | 0 | (1,780) |
Comprehensive earnings attributable to Hasbro, Inc. | $ 65,998 | $ 30,399 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2017 | Mar. 27, 2016 | |
Cash flows from operating activities | ||
Net earnings | $ 68,599 | $ 46,971 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation of plant and equipment | 27,702 | 25,126 |
Amortization of intangibles | 7,881 | 8,691 |
Program production cost amortization | 5,570 | 6,186 |
Deferred income taxes | 13,428 | 9,466 |
Stock-based compensation | 10,844 | 11,973 |
Change in operating assets and liabilities: | ||
Decrease in accounts receivable | 660,253 | 547,154 |
Increase in inventories | (21,377) | (73,238) |
Increase in prepaid expenses and other current assets | (7,200) | (32,032) |
Program Production Costs | (11,738) | (11,619) |
Decrease in accounts payable and accrued liabilities | (342,533) | (218,471) |
Other | 499 | (6,928) |
Net cash provided by operating activities | 411,928 | 313,279 |
Cash flows from investing activities | ||
Additions to property, plant and equipment | (30,243) | (31,218) |
Other | (781) | 3,626 |
Net cash utilized by investing activities | (31,024) | (27,592) |
Cash flows from financing activities | ||
Net repayments of other short-term borrowings | (107,336) | (75,526) |
Purchases of common stock | (19,312) | (33,710) |
Stock-based compensation transactions | 9,743 | 8,153 |
Dividends paid | (63,404) | (57,406) |
Payments related to tax withholding for share-based compensation | (31,391) | (13,600) |
Other | 0 | 762 |
Net cash utilized by financing activities | (211,700) | (171,327) |
Effect of exchange rate changes on cash | 11,592 | 4,770 |
Increase in cash and cash equivalents | 180,796 | 119,130 |
Cash and cash equivalents at beginning of year | 1,282,285 | 976,750 |
Cash and cash equivalents at end of period | 1,463,081 | 1,095,880 |
Supplemental information | ||
Interest | 31,446 | 31,066 |
Income taxes | $ 31,571 | $ 34,332 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Apr. 02, 2017 | |
Basis of Presentation [Abstract] | |
Basis of Presentation | (1 ) Basis of Presentation In the opinion of management, the accompanying unaudited interim financial statements contain all normal and recurring adjustments necessary to present fairly the financial position of Hasbro, Inc. and all majority-owned subsidiaries ("Hasbro" or the "Company") as of April 2, 2017 and March 27, 2016 , and th e results of its operations and cash flows for the periods then ended in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). The preparation of financial statements in conformity with U.S. GAAP requires m anagement to make estimates and assumptions that affect the amounts reported in the financial statements and notes thereto. Actual results could differ from those estimates. The quarter ended April 2, 2017 was a 14-week period. The quarter ended March 27, 2016 was a 13-week period. The results of operations for the quarter are not necessarily indicative of re sults to be expected for the full year, nor were those of the comparable 2016 period representative of those actually experienced for the full year 2016 . These condensed consolidated financial statements have been prepared without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and disclosures normally included in the consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. The Company filed audited consolidated financial statements for the fiscal year ended December 25, 2016 in its Annual Report on Form 10-K, which includes all such information and disclosures and, accordingly, should be read in conjunction with the financial information included herein. The Company's accounting policies are the same as those described in Note 1 to the Company's consolidated financial statements in its Annual Report on Form 10-K for the fiscal year ended December 25, 2016 with the exception of the accounting policy related to stock compensation. During the first quarter of 2017, the Company adopted Acco unting Standards Update (“ ASU ”) 2016-09, Improvements to Employee Share-Based Payment Accounting. The ASU includes provisions intended to simp lify how share-based payments are accounted for and presented in th e financial statements including: Prospectivel y, the requirement to record all of the tax effects related to share-based payments at settlement through the income statement . During the first quarter of 2017, excess tax benefits of $1 3,994 were recorded to income tax expense . A requirement that all tax-related cash flows resulting from share-based payments be reported as operating activities on the statement of cash flows. Previously, these amounts were reported as a cash inflow from financing activities. The Company elected t o apply this requirement of the standard retrospective ly. Accordingly, the cash flow statement for the quarter ended March 27, 2016 has been restated to include $ 6,056 of cash flows from excess tax benefits, previously included as financing activities, in operating activities with other income tax cash flows. For the first quarter of 2017 excess tax benefits of $ 13,994 were reported as operating activities. A requirement that all cash payments made to taxing authorities on the employees’ behalf for withhe ld shares shall be presented as financing activities in the statements of cash flows . Prior to adoption of ASU 2016-09, these cash flows were included as operating activities . This change was required to be applied on a retrospective basis and as a result , the Company has restated the consolidated statement of cash flows for the quarter ended March 27, 2016 . T his change resulted in payments of $ 13,600 for the quarter ended March 27, 2016 being included in financing activities . For the first quarter of 201 7, such payments amounted to $ 31,391 . E ntities are permitted to make an accounting policy election for the impact of forfeitures on the recognition of expense for share-based payment awards choosing either to estimate forfeitures as previously required or recognize forfeitures as they occur. The Company elected to change its method of accounting for forfeitures from estimating the number of stock-based awards expected to vest, to accountin g for forfeitures as they occur which resulted in a one-time charge , net of tax, of $0.7 million to retained earnings. Based upon the Company’s history of forfeitures, it is not expected that this election will have a material impact on its financial statements going forward however, as any impact will be based on future fo rfeitures, the actual impact could differ from the Company’s expectation. Through 2016, the Company had one investment with a redeemable noncontrolling interest which was the Company’s 70 % majority interest in Backflip Studios, LLC (“Backflip”). During th e first quarter of 2017, the Company acquired the remaining 30 % of Backflip for no additional consideration, making it a wholly-owned subsidiary of the Company. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Apr. 02, 2017 | |
Earnings Per Share (Thousands of Dollars and Shares Except Per Share Data) [Abstract] | |
Earnings Per Share | (2 ) Earnings Per Share Net earnings per share data for the quarter s ended April 2, 2017 and March 27, 2016 were computed as follows: 2017 2016 Quarter Basic Diluted Basic Diluted Net earnings attributable to Hasbro, Inc. $ 68,599 68,599 48,751 48,751 Average shares outstanding 125,182 125,182 125,266 125,266 Effect of dilutive securities: Options and other share-based awards - 2,047 - 1,682 Equivalent Shares 125,182 127,229 125,266 126,948 Net earnings attributable to Hasbro, Inc. per common share $ 0.55 0.54 0.39 0.38 For the quarter s ended April 2, 2017 and March 27, 2016 , options and restricted stock units totaling 638 and 492 , respectively, were excluded from the calculation of diluted earnings per share because to include the m would have been antidilutive . |
Other Comprehensive Earnings (L
Other Comprehensive Earnings (Loss) | 3 Months Ended |
Apr. 02, 2017 | |
Other Comprehensive Earnings (Loss) [Abstract] | |
Other Comprehensive Earnings (Loss) | (3 ) Other Comprehensive Earnings (Loss) Components of other comprehensive earnings (loss) are presented within the consolidated statements of comprehensive earnings. The following table presents the related tax effects on changes in other comprehensive earn ings (loss) for the quarters ended April 2, 2017 and March 27, 2016 . Quarter Ended April 2, March 27, 2017 2016 Other comprehensive earnings (loss), tax effect: Tax benefit on cash flow hedging activities $ 5,310 3,256 Tax benefit (expense) on unrealized holding gains 18 (953) Reclassifications to earnings, tax effect: Tax (benefit) expense on cash flow hedging activities (369) 1,749 Tax benefit on unrecognized pension and postretirement amounts reclassified to the consolidated statements of operations (822) (667) Total tax effect on other comprehensive earnings $ 4,137 3,385 Changes in the components of accumulated other comprehensive loss for the quarters ended April 2, 2017 and March 27, 2016 a re as follows: Unrealized Holding (Losses) Total Gains Gains on Foreign Accumulated Pension and (Losses) on Available- Currency Other Postretirement Derivative for-Sale Translation Comprehensive Amounts Instruments Securities Adjustments Earnings (Loss) 2017 Balance at December 25, 2016 $ (118,401) 51,085 1,424 (128,678) (194,570) Current period other comprehensive earnings (loss) 1,448 (28,691) (31) 24,673 (2,601) Balance at April 2, 2017 $ (116,953) 22,394 1,393 (104,005) (197,171) 2016 Balance at December 27, 2015 $ (102,931) 79,317 1,258 (123,645) (146,001) Current period other comprehensive earnings (loss) 1,175 (33,347) 1,680 12,140 (18,352) Balance at March 27, 2016 $ (101,756) 45,970 2,938 (111,505) (164,353) At April 2, 2017 , the Company had remaining net deferred gains on foreign currency forward c ontracts, net of tax, of $40,301 in accumulated other comprehensive loss ("AOCE"). These instruments hedge payments related to inventory purchased in the first quarter of 2017 or forecasted to be purchased during the remainder of 2017 and, to a lesser extent, 2018 through 2021 , intercompany expenses expected to be paid or received during 2017 and 2018 , cash receipts for sales made at the end o f the first quarter of 2017 or forecasted to be made in the remainder of 2017 and, to a lesser extent, 2018 through 2019 . These amounts will be reclassified into the consolidated statements of operations upon the sale of the related inventor y or recognition of the related sales or expenses. In addition to foreign currency forward contracts, the Company entered into hedging contracts on future interest payments related to the long-term notes due in 2021 and 2044. At the date of debt issuance, these contracts were terminated and the fair value on the date of settlement was deferred in AOCE and is being amortized to interest expense over the life of the related notes using the effective interest rate method. At April 2, 2017 , deferred losses, net o f tax of $17,907 related to these instruments remained in AOCE. For the quarter s ended April 2, 2017 and March 27, 2016 , losses of $484 and $450 , respectively, were reclassified from AOCE to net earnings. Of the amount included in AOCE at April 2, 2017 , the Co mpany expects net gains of approxima tely $5,555 to be reclassified to the consolidated statements of operations within the next 12 months. However, the amount ultimately realized in earnings is dependent on the fair value of the hedging instruments on the settlement dates. |
Financial Instruments
Financial Instruments | 3 Months Ended |
Apr. 02, 2017 | |
Financial Instruments (Thousands of Dollars) [Abstract] | |
Financial Instruments | (4 ) Financial Instruments The Company's financial instruments include cash and cash equivalents, accounts receivable, short-term borrowings, accounts payable and certain accrued liabilities. At April 2, 2017 , March 27, 2016 and December 25, 2016 , the carrying cost of these instruments approximated their fair value. The Company's financial instruments at April 2, 2017 , March 27, 2016 and December 25, 2016 also include certain assets and liabilities mea sured at fair value (see Notes 6 an d 8 ) as well as long-term borrowings. The carrying costs which are equal to the outstanding principal amounts, and fair values of the Company's long-term borrowings as of April 2, 2017 , March 27, 2016 and December 25, 2016 are as follows: April 2, 2017 March 27, 2016 December 25, 2016 Carrying Fair Carrying Fair Carrying Fair Cost Value Cost Value Cost Value 6.35% Notes Due 2040 $ 500,000 597,150 500,000 560,900 500,000 584,850 6.30% Notes Due 2017 350,000 357,385 350,000 370,965 350,000 361,900 5.10% Notes Due 2044 300,000 306,570 300,000 287,610 300,000 297,600 3.15% Notes Due 2021 300,000 305,490 300,000 302,880 300,000 300,450 6.60% Debentures Due 2028 109,895 125,390 109,895 122,456 109,895 123,984 Total long-term debt $ 1,559,895 1,691,985 1,559,895 1,644,811 1,559,895 1,668,784 Less: Current portion 350,000 357,385 - - 350,000 361,900 Less: Deferred debt expenses 10,999 - 12,461 - 11,216 - Long-term debt $ 1,198,896 1,334,600 1,547,434 1,644,811 1,198,679 1,306,884 Current portion of long-term debt at April 2, 2017 and December 25, 2016 of $ 349,814 and $ 349,713 , respectively, as shown on the consolidated balance sheet represents the $350,000 principal of 6.30% notes less $ 186 and $ 287 , respectively, of deferred debt expenses. The fair values of the Company's long-term debt are considered Level 3 fair values (see Note 6 for further discussion of the fair value hierarchy) and are measured using the discounted future cash flows method. In addition to the debt term s, the valuation methodology includes an assumption of a discount rate that approximates the current yield on a similar debt security. This assumption is considered an unobservable input in that it reflects the Company's own assumptions about the inputs th at market participants would use in pricing the asset or liability. The Company believes that this is the best information available for use in the fair value measurement. |
Income Taxes
Income Taxes | 3 Months Ended |
Apr. 02, 2017 | |
Income Taxes (Thousands of Dollars) [Abstract] | |
Income Taxes | (5 ) Income Taxes The Company and its subsidiaries file income tax returns in the United States and various state and international jurisdictions. In the normal course of business, the Company is regularly audited by U.S. federal, state and local and international tax authorities in various tax jurisdictions. The Company is no longer subject to U.S. federal income tax examinations for years before 2012. With few exceptions, the Company is no longer subject to U.S. state or local and non-U.S. income t ax examinations by tax authorities in its major jurisdictions for years before 2009. The Company is currently under income tax examination in several U.S. state and l ocal and non-U.S. jurisdictions . |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Apr. 02, 2017 | |
Fair Value of Financial Instruments (Thousands of Dollars) [Abstract] | |
Fair Value of Financial Instruments | (6) Fair Value of Financial Instruments The Company measures certain financial instruments at fair value. The fair value hierarchy consists of three levels: Level 1 fair values are based on quoted market prices in active markets for identical assets or liabilities that the entity has the ability to access; Level 2 fair values are those based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by o bservable data for substantially the full term of the assets or liabilities; and Level 3 fair values are based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Accounting standards permit entities to measure many financial instruments and certain other items at fair value and establish presentation and disclosure requirements designed to facilitate comparisons between entities that choose different measurement attributes f or similar assets and liabilities. The Company has elected the fair value option for certain available-for-sale investments. At April 2, 2017 , March 27, 2016 and December 25, 2016 , t hese investments totaled $23,603, $22,665 and $23,571 , respectively, and are included in prepaid expenses and other current assets in the consolidated balance sheets. The Company recorded net gains of $631 and $83 on these investments in other (income) expense, net for the quarter s ended April 2, 2017 and March 27, 2016 , respe ctively, related to the change in fair value of such instruments. At April 2, 2017 , March 27, 2016 and December 25, 2016 , the Company had the following assets and liabilities measured at fair value in its consolidated balance sheets (excluding ass ets for which the fair value is measured using net asset value per share) : Fair Value Measurements Using: Quoted Prices in Active Markets Significant for Other Significant Identical Observable Unobservable Fair Assets Inputs Inputs Value (Level 1) (Level 2) (Level 3) April 2, 2017 Assets: Available-for-sale securities $ 3,687 3,687 - - Derivatives 56,017 - 56,017 - Total assets $ 59,704 3,687 56,017 - Liabilities: Derivatives $ 20,595 - 20,595 - Option agreement 28,710 - - 28,710 Total liabilities $ 49,305 - 20,595 28,710 March 27, 2016 Assets: Available-for-sale securities $ 6,109 6,109 - - Derivatives 69,720 - 69,720 - Total assets $ 75,829 6,109 69,720 - Liabilities: Derivatives $ 3,932 - 3,932 - Option agreement 27,920 - - 27,920 Total liabilities $ 31,852 - 3,932 27,920 December 25, 2016 Assets: Available-for-sale securities $ 3,736 3,736 - - Derivatives 87,894 - 87,894 - Total assets $ 91,630 3,736 87,894 - Liabilities: Derivatives $ 11,309 - 11,309 - Option agreement 28,770 - - 28,770 Total Liabilities $ 40,079 - 11,309 28,770 Available-for-sale securities include equity securities of one company quoted on an active public market . The Company' s derivatives consist of foreign currency forward contracts. The Company used current forward rates of the respective foreign currencies to measure the fair value of these contracts. The option agreement included in other liabilities at April 2, 2017 , March 27, 2016 and December 25, 2016 , is valued using an option pricing model based on the fair value of the related investment. Inputs used in the option pricing model include the volatility and fair value of the underlying compan y which are considered unobservable inputs as they reflect the Company's own assumptions about the inputs that market participants would use in pricing the asset or liability. The Company believes that this is the best information available for use in the fair value measurement. There were no changes in these valua tion techniques during the three -month period ended April 2, 2017 . The following is a reconciliation of the beginning and ending balances of the fair value measurements of the Company's fin ancial instruments which use significant unobservable inputs (Level 3): 2017 2016 Balance at beginning of year $ (28,770) (28,360) Gain from change in fair value 60 440 Balance at end of first quarter $ (28,710) (27,920) In addition to the above, the Company has three investments for which the fair value is measured using net asset value per share. At April 2, 2017 , March 27, 2016 and December 25, 2016 , these investments had fair values of $ 23 ,603, $ 22,665 and $ 23,571, respectively. Two of the investments have net asset values that are predominantly based on underlying investments which are traded on an active market and are redeemable within 45 days. The third investment invests in hedge funds which are generall y redeemable on a quarterly basis with 30 – 90 days’ notice. |
Pension and Postretirement Bene
Pension and Postretirement Benefits | 3 Months Ended |
Apr. 02, 2017 | |
Pension and Postretirement Benefits (Thousands of Dollars) [Abstract] | |
Pension and Postretirement Benefits | (7) Pension and Postretirement Benefits The components of the net periodic cost of the Company's defined benefit pension and other postretirement plans for th e quarters ended April 2, 2017 and March 27, 2016 are as follows: Quarter Ended Pension Postretirement April 2, March 27, April 2, March 27, 2017 2016 2017 2016 Service cost $ 952 998 172 132 Interest cost 4,725 4,606 295 294 Expected return on assets (6,281) (5,507) - - Net amortization and deferrals 2,694 2,132 - - Net periodic benefit cost $ 2,090 2,229 467 426 During the three months ended April 2, 2017 , the Company made cash contributions to its defined benefit pe nsion plans of approximately $ 700 in the aggregate. The Company expects to contribute approximately $ 2 7 ,900 during the remainder of fiscal 2017 . |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Apr. 02, 2017 | |
Derivative Financial Instruments (Thousands of Dollars) [Abstract] | |
Derivative Financial Instruments | (8 ) Derivative Financial Instruments Hasbro uses foreign currency forward contracts to mitigate the impact of currency rate fluctuations on firmly committed and projected future foreign currency transactions. These over-the-counter contracts, which hedge future currency requirements related to purchases of inventory, product sales and other cross-border transactions not denominated in the functional currency of the business unit, are primarily denominated in United States and Hong Kong dollars, and E uros. All contracts are entered into with a number of counterparties, all of which are major financial institutions. The Company believes that a default by a single counterparty would not have a material adverse effect on the financial condition of the Com pany. Hasbro does not enter into derivative financial instruments for speculative purposes. Cash Flow Hedges The Company uses foreign currency forward contracts to reduce the impact of currency rate fluctuations on firmly committed and projected future foreign currency transactions. All of the Company's designated foreign currency forward contracts are considered to be cash flow hedges. These instruments hedge a portion of the Company's currency requirements associated with anticipated inventory purchases, product sales and other cross-border transactions in 2017 through 2021 . At April 2, 2017 , March 27, 2016 and December 25, 2016 , the notional amounts and fair values of the Company's foreign currency forward contracts designated as cash flow hedging instruments were as follows: April 2, 2017 March 27, 2016 December 25, 2016 Notional Fair Notional Fair Notional Fair Hedged transaction Amount Value Amount Value Amount Value Inventory purchases $ 974,235 35,711 1,277,977 69,748 945,728 60,520 Sales 423,828 1,083 82,072 258 290,181 9,775 Royalties and Other 324,008 (1,345) 270,207 (4,077) 198,849 1,633 Total $ 1,722,071 35,449 1,630,256 65,929 1,434,758 71,928 The Company has a master agreement with each of its counterparties that allows for the netting of outstanding forward contracts. The fair values of the Company's foreign currency forward contracts designated as cash flow hedges are recorded in the consolidated balance sheets at April 2, 2017 , March 27, 2016 and December 25, 2016 as follows: April 2, March 27, December 25, 2017 2016 2016 Prepaid expenses and other current assets Unrealized gains $ 23,241 53,774 34,265 Unrealized losses (3,204) (6,890) (2,075) Net unrealized gain $ 20,037 46,884 32,190 Other assets Unrealized gains $ 39,032 26,454 51,839 Unrealized losses (3,052) (3,618) (792) Net unrealized gains $ 35,980 22,836 51,047 Accrued liabilities Unrealized gains $ 9,041 1,900 8,481 Unrealized losses (28,591) (3,086) (19,790) Net unrealized loss $ (19,550) (1,186) (11,309) Other liabilities Unrealized gains $ 149 1,349 - Unrealized losses (1,167) (3,954) - Net unrealized loss $ (1,018) (2,605) - Net gains on cash flow hedging activities have been reclassified from other comprehensive earnings (loss) to net earnings for the quarter s ended April 2, 2017 and March 27, 2016 as follows: Quarter Ended April 2, March 27, 2017 2016 Statements of Operations Classification Cost of sales $ 9,874 15,698 Sales 541 98 Other 31 7 Net realized gains $ 10,446 15,803 In addition, (losses) gains of $ ( 4,958 ) and $3,957 were reclassified to earnings as a result of hedge inef fectiveness for the quarter s ended April 2, 2017 and March 27, 2016 , respectively. Undesignated Hedges The Company also enters into foreign currency forward contracts to minimize the impact of changes in the fair value of intercompany loans due to foreign currency changes . T he Company does not use hedge accounting for these contracts as changes in the fair values of these contracts are substantially offset by changes in the fair value of the intercompany loans . As of April 2, 2017 , March 27, 2016 and December 25, 2016 the total notional amounts of the Company's undesignated deri vative instruments were $ 62,806 , $ 88,862 and $ 268,308 , respectively. At April 2, 2017 , March 27, 2016 and December 25, 2016 , the fair values of the Company's undesignated derivative financial instruments were recorded in the consolidated balance sheets as follows: April 2, March 27, December 25, 2017 2016 2016 Prepaid expenses and other current assets Unrealized gains $ - - 5,854 Unrealized losses - - (1,197) Net unrealized gain $ - - 4,657 Accrued liabilities Unrealized gains $ 289 321 - Unrealized losses (316) (462) - Net unrealized loss $ (27) (141) - Total unrealized (loss) gain, net $ (27) (141) 4,657 The Comp any recorded net gains of $ 3,581 and $ 3,2 55 on these instruments to other (income) expense, net for the quarter s ended April 2, 2017 and March 27, 2016 , respectively, relating to the change in fair value of such derivatives, substantially offsetting gains and losses from the change in fair value of intercompany loans to which the contracts relate. For additional information related to the Company's derivative f inancial instruments see Notes 4 and 6 . |
Segment Reporting
Segment Reporting | 3 Months Ended |
Apr. 02, 2017 | |
Segment Reporting (Thousands of Dollars) [Abstract] | |
Segment Reporting | (9) Segment Reporting Hasbro is a global play and entertainment company with a broad portfolio of brands and entertainment properties spanning toys, games, licensed products ranging from traditional to high-tech and digital, and film and television entertainment. The Company's segments are (i) U.S. and Canada, (ii) International, (iii) Entertainment and Licensing, and (iv) Global Operations. The U.S. and Canada segment includes the marketing and selling of action figures, arts and crafts and creative play products, electronic toys and related electronic interactive products, fashion and other dolls, infant products, play sets, preschool toys, plush products, sports action blasters and accessories, vehicles and toy-related specialty products, as well as trad itional board games, and trading card and role-playing games primarily within the United States and Canada. Within the International segment, the Company markets and sells both toy and game products in markets outside of the U.S. and Canada, primarily in the European, Asia Pac ific, and Latin and South American regions. The Company's Entertainment and Licensing segment includes the Company's consumer products licensing, digital gaming, movie and television entertainment operations. The Global Operations segment is responsible fo r sourcing finished products for the Company's U.S. and Canada and International segments. Segment performance is measured at the operating profit level. Included in Corporate and E liminations are certain corporate expenses, including the elimination of i ntersegment transactions and certain assets benefiting more than one segment. Intersegment sales and transfers are reflected in management reports at amounts approximating cost. Certain shared costs, including global development and marketing expenses and corporate administration, are allocated to segments based upon expenses and foreign exchange rates fixed at the beginning of the year, with adjustments to actual expenses and foreign exchange rates included in Corporate and e liminations. The accounting pol icies of the segments are the sa me as those referenced in note 1 . Results shown for the quarter are not necessarily representative of those which may be expected for the full year 2017 , nor were those of the comparable 2016 period representative of those actually experienced for the full year 2016 . Similarly, such results are not necessarily those which would be achieved were each segment an unaffiliated business enterprise. Information by segment and a reconciliation to repo rted amounts for the quarters ended April 2, 2017 and March 27, 2016 are as follow s: Quarter Ended April 2, 2017 March 27, 2016 Net revenues External Affiliate External Affiliate U.S. and Canada $ 451,577 2,391 443,648 1,444 International 345,281 - 345,037 - Entertainment and Licensing 52,729 3,502 42,495 4,701 Global Operations (a) 76 260,229 - 297,189 Corporate and Eliminations - (266,122) - (303,334) $ 849,663 - 831,180 - Quarter Ended April 2, March 27, Operating profit (loss) 2017 2016 U.S. and Canada $ 64,754 78,335 International 544 2,853 Entertainment and Licensing 11,346 5,442 Global Operations (a) 833 3,444 Corporate and Eliminations (b) 866 (4,158) $ 78,343 85,916 April 2, March 27, December 25, Total assets 2017 2016 2016 U.S. and Canada $ 2,618,808 2,751,504 2,559,792 International 1,964,343 1,983,747 2,368,761 Entertainment and Licensing 763,988 614,003 692,898 Global Operations 2,218,817 2,423,811 2,326,566 Corporate and Eliminations (b) (2,920,086) (3,408,370) (2,856,651) $ 4,645,870 4,364,695 5,091,366 (a) The Global Operations segment derives substantially all of its revenues, and thus its operating results, from intersegment activities. (b) Certain long-term assets, including property, plant and equipment, goodwill and other intangibles, which benefit multiple operating segments, are included in Corporate and Eliminations. Allocations of certain expenses related to these assets to the individual operating segments are done at the beginning of the year based on budgeted amounts. Any differences b etween actual and budgeted amounts are reflected in Corporate and Eliminations because allocations are translated from the US Dollar to local currenc y at budget rates when recorded. Corporate and Eliminations also includes the elimin ation of inter-comp any balance sheet amounts. The following table represents consolidated International segment net revenues by major geographic region for the quarter s ended April 2, 2017 and March 27, 2016 . Quarter Ended April 2, March 27, 2017 2016 Europe $ 216,120 224,123 Latin America 64,756 55,596 Asia Pacific 64,405 65,318 Net revenues $ 345,281 345,037 The following table presents consolidated net revenues by brand portfolio for the quarter s ended April 2, 2017 and March 27, 2016 . Quarter Ended April 2, March 27, 2017 2016 Franchise Brands $ 423,603 416,374 Partner Brands 212,962 258,225 Hasbro Gaming 142,913 100,228 Emerging Brands 70,185 56,353 Total $ 849,663 831,180 Hasbro's total gaming category, including the Hasbro Gaming portfolio as reported above and all other gaming revenue, most notably MAGIC: THE GATHERING and MONOPOLY, which are included in the Franchise Brands portfolio, totaled $ 253,289 for the first quarter of 2017, up 10 %, from revenues of $ 231,147 for the first quarter of 2016. Hasbro believes its gaming portfolio is a competitive differentiator and views it in its entirety. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Apr. 02, 2017 | |
Earnings Per Share (Thousands of Dollars and Shares Except Per Share Data) [Abstract] | |
Earnings Per Share | 2017 2016 Quarter Basic Diluted Basic Diluted Net earnings attributable to Hasbro, Inc. $ 68,599 68,599 48,751 48,751 Average shares outstanding 125,182 125,182 125,266 125,266 Effect of dilutive securities: Options and other share-based awards - 2,047 - 1,682 Equivalent Shares 125,182 127,229 125,266 126,948 Net earnings attributable to Hasbro, Inc. per common share $ 0.55 0.54 0.39 0.38 |
Other Comprehensive Earnings 17
Other Comprehensive Earnings (Loss) (Tables) | 3 Months Ended |
Apr. 02, 2017 | |
Other Comprehensive Earnings (Loss) [Abstract] | |
Schedule of Other Comprehensive Income, Tax Effect [Text Block] | Quarter Ended April 2, March 27, 2017 2016 Other comprehensive earnings (loss), tax effect: Tax benefit on cash flow hedging activities $ 5,310 3,256 Tax benefit (expense) on unrealized holding gains 18 (953) Reclassifications to earnings, tax effect: Tax (benefit) expense on cash flow hedging activities (369) 1,749 Tax benefit on unrecognized pension and postretirement amounts reclassified to the consolidated statements of operations (822) (667) Total tax effect on other comprehensive earnings $ 4,137 3,385 |
Schedule of Accumulated Other Comprehensive Earnings (Loss) | Unrealized Holding (Losses) Total Gains Gains on Foreign Accumulated Pension and (Losses) on Available- Currency Other Postretirement Derivative for-Sale Translation Comprehensive Amounts Instruments Securities Adjustments Earnings (Loss) 2017 Balance at December 25, 2016 $ (118,401) 51,085 1,424 (128,678) (194,570) Current period other comprehensive earnings (loss) 1,448 (28,691) (31) 24,673 (2,601) Balance at April 2, 2017 $ (116,953) 22,394 1,393 (104,005) (197,171) 2016 Balance at December 27, 2015 $ (102,931) 79,317 1,258 (123,645) (146,001) Current period other comprehensive earnings (loss) 1,175 (33,347) 1,680 12,140 (18,352) Balance at March 27, 2016 $ (101,756) 45,970 2,938 (111,505) (164,353) |
Financial Instruments (Tables)
Financial Instruments (Tables) | 3 Months Ended |
Apr. 02, 2017 | |
Financial Instruments (Thousands of Dollars) [Abstract] | |
Schedule of Long-term Debt Instruments | April 2, 2017 March 27, 2016 December 25, 2016 Carrying Fair Carrying Fair Carrying Fair Cost Value Cost Value Cost Value 6.35% Notes Due 2040 $ 500,000 597,150 500,000 560,900 500,000 584,850 6.30% Notes Due 2017 350,000 357,385 350,000 370,965 350,000 361,900 5.10% Notes Due 2044 300,000 306,570 300,000 287,610 300,000 297,600 3.15% Notes Due 2021 300,000 305,490 300,000 302,880 300,000 300,450 6.60% Debentures Due 2028 109,895 125,390 109,895 122,456 109,895 123,984 Total long-term debt $ 1,559,895 1,691,985 1,559,895 1,644,811 1,559,895 1,668,784 Less: Current portion 350,000 357,385 - - 350,000 361,900 Less: Deferred debt expenses 10,999 - 12,461 - 11,216 - Long-term debt $ 1,198,896 1,334,600 1,547,434 1,644,811 1,198,679 1,306,884 |
Fair Value of Financial Instr19
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Apr. 02, 2017 | |
Fair Value of Financial Instruments (Thousands of Dollars) [Abstract] | |
Fair Value Hierarchy | Fair Value Measurements Using: Quoted Prices in Active Markets Significant for Other Significant Identical Observable Unobservable Fair Assets Inputs Inputs Value (Level 1) (Level 2) (Level 3) April 2, 2017 Assets: Available-for-sale securities $ 3,687 3,687 - - Derivatives 56,017 - 56,017 - Total assets $ 59,704 3,687 56,017 - Liabilities: Derivatives $ 20,595 - 20,595 - Option agreement 28,710 - - 28,710 Total liabilities $ 49,305 - 20,595 28,710 March 27, 2016 Assets: Available-for-sale securities $ 6,109 6,109 - - Derivatives 69,720 - 69,720 - Total assets $ 75,829 6,109 69,720 - Liabilities: Derivatives $ 3,932 - 3,932 - Option agreement 27,920 - - 27,920 Total liabilities $ 31,852 - 3,932 27,920 December 25, 2016 Assets: Available-for-sale securities $ 3,736 3,736 - - Derivatives 87,894 - 87,894 - Total assets $ 91,630 3,736 87,894 - Liabilities: Derivatives $ 11,309 - 11,309 - Option agreement 28,770 - - 28,770 Total Liabilities $ 40,079 - 11,309 28,770 |
Reconciliation of Level 3 Fair Value | 2017 2016 Balance at beginning of year $ (28,770) (28,360) Gain from change in fair value 60 440 Balance at end of first quarter $ (28,710) (27,920) |
Pension and Postretirement Be20
Pension and Postretirement Benefits (Tables) | 3 Months Ended |
Apr. 02, 2017 | |
Pension and Postretirement Benefits (Thousands of Dollars) [Abstract] | |
Components of net periodic cost | Quarter Ended Pension Postretirement April 2, March 27, April 2, March 27, 2017 2016 2017 2016 Service cost $ 952 998 172 132 Interest cost 4,725 4,606 295 294 Expected return on assets (6,281) (5,507) - - Net amortization and deferrals 2,694 2,132 - - Net periodic benefit cost $ 2,090 2,229 467 426 |
Derivative Financial Instrume21
Derivative Financial Instruments (Tables) | 3 Months Ended |
Apr. 02, 2017 | |
Derivative Financial Instruments (Thousands of Dollars) [Abstract] | |
Summary of Cash Flow Hedging Instruments | April 2, 2017 March 27, 2016 December 25, 2016 Notional Fair Notional Fair Notional Fair Hedged transaction Amount Value Amount Value Amount Value Inventory purchases $ 974,235 35,711 1,277,977 69,748 945,728 60,520 Sales 423,828 1,083 82,072 258 290,181 9,775 Royalties and Other 324,008 (1,345) 270,207 (4,077) 198,849 1,633 Total $ 1,722,071 35,449 1,630,256 65,929 1,434,758 71,928 |
Derivatives Fair Value by Balance Sheet Location | April 2, March 27, December 25, 2017 2016 2016 Prepaid expenses and other current assets Unrealized gains $ 23,241 53,774 34,265 Unrealized losses (3,204) (6,890) (2,075) Net unrealized gain $ 20,037 46,884 32,190 Other assets Unrealized gains $ 39,032 26,454 51,839 Unrealized losses (3,052) (3,618) (792) Net unrealized gains $ 35,980 22,836 51,047 Accrued liabilities Unrealized gains $ 9,041 1,900 8,481 Unrealized losses (28,591) (3,086) (19,790) Net unrealized loss $ (19,550) (1,186) (11,309) Other liabilities Unrealized gains $ 149 1,349 - Unrealized losses (1,167) (3,954) - Net unrealized loss $ (1,018) (2,605) - |
Schedule of Derivative Instruments, Gain (Loss) in Statement of Operations | Quarter Ended April 2, March 27, 2017 2016 Statements of Operations Classification Cost of sales $ 9,874 15,698 Sales 541 98 Other 31 7 Net realized gains $ 10,446 15,803 |
Fair values of undesignated derivative financial instruments | April 2, March 27, December 25, 2017 2016 2016 Prepaid expenses and other current assets Unrealized gains $ - - 5,854 Unrealized losses - - (1,197) Net unrealized gain $ - - 4,657 Accrued liabilities Unrealized gains $ 289 321 - Unrealized losses (316) (462) - Net unrealized loss $ (27) (141) - Total unrealized (loss) gain, net $ (27) (141) 4,657 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Apr. 02, 2017 | |
Segment Reporting (Thousands of Dollars) [Abstract] | |
Net revenues by segment | Quarter Ended April 2, 2017 March 27, 2016 Net revenues External Affiliate External Affiliate U.S. and Canada $ 451,577 2,391 443,648 1,444 International 345,281 - 345,037 - Entertainment and Licensing 52,729 3,502 42,495 4,701 Global Operations (a) 76 260,229 - 297,189 Corporate and Eliminations - (266,122) - (303,334) $ 849,663 - 831,180 - |
Operating profit (loss) by segments | Quarter Ended April 2, March 27, Operating profit (loss) 2017 2016 U.S. and Canada $ 64,754 78,335 International 544 2,853 Entertainment and Licensing 11,346 5,442 Global Operations (a) 833 3,444 Corporate and Eliminations (b) 866 (4,158) $ 78,343 85,916 |
Total assets by segments | April 2, March 27, December 25, Total assets 2017 2016 2016 U.S. and Canada $ 2,618,808 2,751,504 2,559,792 International 1,964,343 1,983,747 2,368,761 Entertainment and Licensing 763,988 614,003 692,898 Global Operations 2,218,817 2,423,811 2,326,566 Corporate and Eliminations (b) (2,920,086) (3,408,370) (2,856,651) $ 4,645,870 4,364,695 5,091,366 |
Schedule of net revenues by international region | Quarter Ended April 2, March 27, 2017 2016 Europe $ 216,120 224,123 Latin America 64,756 55,596 Asia Pacific 64,405 65,318 Net revenues $ 345,281 345,037 |
Net revenues by product category | Quarter Ended April 2, March 27, 2017 2016 Franchise Brands $ 423,603 416,374 Partner Brands 212,962 258,225 Hasbro Gaming 142,913 100,228 Emerging Brands 70,185 56,353 Total $ 849,663 831,180 |
Basis of Presentation (Details)
Basis of Presentation (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Apr. 02, 2017 | Mar. 27, 2016 | Dec. 25, 2016 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Payments Related To Tax Withholding For Share Based Compensation | $ 31,391 | $ 13,600 | |
Backflip Studios, LLC [Member] | |||
Redeemable Noncontrolling Interest [Line Items] | |||
MinorityInterestOwnershipPercentageByParent | 70.00% | ||
Noncontrolling Interest, Remaining Ownership Percentage Acquired by Parent | 30.00% | ||
Accounting Standards Update 2016-09 [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Excess Tax Benefit from Share-based Compensation, Operating Activities | $ 13,994 | 6,056 | |
Payments Related To Tax Withholding For Share Based Compensation | 31,391 | $ 13,600 | |
Stock Issued During Period, Value, Restricted Stock Award, Forfeitures | $ 700 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Apr. 02, 2017 | Mar. 27, 2016 | |
Earnings Per Share (Thousands of Dollars and Shares Except Per Share Data) [Abstract] | ||
Net Earnings Attributable to Hasbro, Inc. | $ 68,599 | $ 48,751 |
Basic [Abstract] | ||
Average shares outstanding (in shares) | 125,182 | 125,266 |
Equivalent shares (basic) (in shares) | 125,182 | 125,266 |
Net earnings attributable to Hasbro, Inc. per common share-basic (in dollars per share) | $ 0.55 | $ 0.39 |
Diluted [Abstract] | ||
Average shares outstanding (in shares) | 125,182 | 125,266 |
Effect of dilutive securities: | ||
Options and other share-based awards (in shares) | 2,047 | 1,682 |
Equivalent shares (diluted) (in shares) | 127,229 | 126,948 |
Net earnings attributable to Hasbro, Inc. per common share-diluted (in dollars per share) | $ 0.54 | $ 0.38 |
Employee Stock Option and Restricted Stock Units [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Options to acquire shares totaling excluded as antidilutive | 638 | 492 |
Other Comprehensive Earnings 25
Other Comprehensive Earnings (Loss), Tax Effects on Changes in Other Comprehensive Earnings (loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2017 | Mar. 27, 2016 | |
Other Comprehensive Earnings (Loss) [Abstract] | ||
Tax benefit (expense) on cash flow hedging activities | $ 5,310 | $ 3,256 |
Tax benefit (expense) on unrealized holding gains | 18 | (953) |
Reclassification Adjustment from AOCE, Tax expense (benefit) on cash flow hedging activities | (369) | 1,749 |
Reclassification Adjustment from AOCE, Tax expense (benefit) on amortization of unrecognized pension and postretirement amounts | (822) | (667) |
Other Comprehensive Income (Loss), Tax, Portion Attributable to Parent, Total | 4,137 | $ 3,385 |
Cash Flow Hedge gains to be Reclassified within Twelve Months | $ 5,555 |
Other Comprehensive Earnings 26
Other Comprehensive Earnings (Loss), Changes in the components of accumulated other comprehensive loss (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2017 | Mar. 27, 2016 | |
Accumulated Other Comprehensive (Loss) [Line Items] | ||
Total accumulated other comprehensive earnings (loss), Beginning of Year | $ (194,570) | $ (146,001) |
Other Comprehensive Earnings (Loss), Net of Tax, Total | (2,601) | (18,352) |
Total accumulated other comprehensive earnings (loss), End of Period | (197,171) | (164,353) |
Pension and Postretirement Amounts [Member] | ||
Accumulated Other Comprehensive (Loss) [Line Items] | ||
Total accumulated other comprehensive earnings (loss), Beginning of Year | (118,401) | (102,931) |
Other Comprehensive Earnings (Loss), Net of Tax, Total | 1,448 | 1,175 |
Total accumulated other comprehensive earnings (loss), End of Period | (116,953) | (101,756) |
Gains (Losses) On Derivative Instruments [Member] | ||
Accumulated Other Comprehensive (Loss) [Line Items] | ||
Total accumulated other comprehensive earnings (loss), Beginning of Year | 51,085 | 79,317 |
Other Comprehensive Earnings (Loss), Net of Tax, Total | (28,691) | (33,347) |
Total accumulated other comprehensive earnings (loss), End of Period | 22,394 | 45,970 |
Gains (Losses) On Derivative Instruments [Member] | Interest Rate Contract [Member] | ||
Accumulated Other Comprehensive (Loss) [Line Items] | ||
Total accumulated other comprehensive earnings (loss), End of Period | (17,907) | |
Gains (Losses) On Derivative Instruments [Member] | Foreign Exchange Forward [Member] | ||
Accumulated Other Comprehensive (Loss) [Line Items] | ||
Total accumulated other comprehensive earnings (loss), End of Period | 40,301 | |
Unrealized Holding Gains on Available-for-Sale Securities [Member] | ||
Accumulated Other Comprehensive (Loss) [Line Items] | ||
Total accumulated other comprehensive earnings (loss), Beginning of Year | 1,424 | 1,258 |
Other Comprehensive Earnings (Loss), Net of Tax, Total | (31) | 1,680 |
Total accumulated other comprehensive earnings (loss), End of Period | 1,393 | 2,938 |
Foreign Currency Translation Adjustments [Member] | ||
Accumulated Other Comprehensive (Loss) [Line Items] | ||
Total accumulated other comprehensive earnings (loss), Beginning of Year | (128,678) | (123,645) |
Other Comprehensive Earnings (Loss), Net of Tax, Total | 24,673 | 12,140 |
Total accumulated other comprehensive earnings (loss), End of Period | $ (104,005) | $ (111,505) |
Other Comprehensive Earnings 27
Other Comprehensive Earnings (Loss), Reclassification From Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2017 | Mar. 27, 2016 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Interest Expense | $ 24,456 | $ 24,044 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Gains (Losses) On Derivative Instruments [Member] | Interest Rate Contract [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Interest Expense | $ 484 | $ 450 |
Financial Instruments (Details)
Financial Instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Apr. 02, 2017 | Dec. 25, 2016 | Mar. 27, 2016 | |
Debt Instrument [Line Items] | |||
Carrying Cost | $ 1,559,895 | $ 1,559,895 | $ 1,559,895 |
Current portion of long-term debt | 350,000 | 350,000 | 0 |
Less: Deferred debt expenses | 10,999 | 11,216 | 12,461 |
Long-term debt | 1,198,896 | 1,198,679 | 1,547,434 |
Fair Value | 1,691,985 | 1,668,784 | 1,644,811 |
Long-Term Debt Fair Value, Current Maturities | 357,385 | 361,900 | 0 |
Long-term Debt Fair Value, Excluding Current Maturities | 1,334,600 | 1,306,884 | 1,644,811 |
Current portion of long-term debt | 349,814 | 349,713 | 0 |
Notes 6.35% Due 2040 [Member] | |||
Debt Instrument [Line Items] | |||
Carrying Cost | 500,000 | 500,000 | 500,000 |
Fair Value | $ 597,150 | 584,850 | 560,900 |
Maturity Date | Mar. 15, 2040 | ||
Interest Rate | 6.35% | ||
Notes 6.30% Due 2017 [Member] | |||
Debt Instrument [Line Items] | |||
Carrying Cost | $ 350,000 | 350,000 | 350,000 |
Fair Value | $ 357,385 | 361,900 | 370,965 |
Maturity Date | Sep. 15, 2017 | ||
Interest Rate | 6.30% | ||
Current portion of long-term debt | $ 349,814 | 349,713 | |
Deferred debt expenses, current portion | 186 | 287 | |
Notes 5.10% Due 2044 [Member] | |||
Debt Instrument [Line Items] | |||
Carrying Cost | 300,000 | 300,000 | 300,000 |
Fair Value | $ 306,570 | 297,600 | 287,610 |
Maturity Date | May 16, 2044 | ||
Interest Rate | 5.10% | ||
Notes 3.15% Due 2021 [Member] | |||
Debt Instrument [Line Items] | |||
Carrying Cost | $ 300,000 | 300,000 | 300,000 |
Fair Value | $ 305,490 | 300,450 | 302,880 |
Maturity Date | May 17, 2021 | ||
Interest Rate | 3.15% | ||
Debentures 6.60% Due 2028 [Member] | |||
Debt Instrument [Line Items] | |||
Carrying Cost | $ 109,895 | 109,895 | 109,895 |
Fair Value | $ 125,390 | $ 123,984 | $ 122,456 |
Maturity Date | Jan. 18, 2028 | ||
Interest Rate | 6.60% |
Fair Value of Financial Instr29
Fair Value of Financial Instruments, Assests and Liabilities Measured at Fair Value (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Apr. 02, 2017 | Dec. 25, 2016 | Mar. 27, 2016 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-sale securities, assets | $ 3,687 | $ 3,736 | $ 6,109 |
Derivatives, assets | 56,017 | 87,894 | 69,720 |
Total assets, fair value hierarchy | 59,704 | 91,630 | 75,829 |
Derivatives, liabilities | 20,595 | 11,309 | 3,932 |
Option Agreement | 28,710 | 28,770 | 27,920 |
Total Liabilities | $ 49,305 | 40,079 | 31,852 |
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share, Investment Redemption, Notice Period | 45 days | ||
Minimum [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share, Investment Redemption, Notice Period | 60 days | ||
Maximum [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share, Investment Redemption, Notice Period | 90 days | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-sale securities, assets | $ 3,687 | 3,736 | 6,109 |
Derivatives, assets | 0 | 0 | 0 |
Total assets, fair value hierarchy | 3,687 | 3,736 | 6,109 |
Derivatives, liabilities | 0 | 0 | 0 |
Option Agreement | 0 | 0 | 0 |
Total Liabilities | 0 | 0 | 0 |
Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-sale securities, assets | 0 | 0 | 0 |
Derivatives, assets | 56,017 | 87,894 | 69,720 |
Total assets, fair value hierarchy | 56,017 | 87,894 | 69,720 |
Derivatives, liabilities | 20,595 | 11,309 | 3,932 |
Option Agreement | 0 | 0 | 0 |
Total Liabilities | 20,595 | 11,309 | 3,932 |
Significant Unobservable Inputs (Level 3) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-sale securities, assets | 0 | 0 | 0 |
Derivatives, assets | 0 | 0 | 0 |
Total assets, fair value hierarchy | 0 | 0 | 0 |
Derivatives, liabilities | 0 | 0 | 0 |
Option Agreement | 28,710 | 28,770 | 27,920 |
Total Liabilities | $ 28,710 | $ 28,770 | $ 27,920 |
Fair Value of Financial Instr30
Fair Value of Financial Instruments, Significant Unobservable Inputs Roll Forward (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Apr. 02, 2017 | Mar. 27, 2016 | Dec. 25, 2016 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance at beginning of year | $ (28,770) | $ (28,360) | |
Gain from change in fair value | 60 | 440 | |
Balance at end of period | (28,710) | (27,920) | |
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||
Other (income) expense, net | 11,386 | (4,872) | |
Fair Value, Measurements, Recurring [Member] | |||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||
Alternative Investments, Fair Value Disclosure | 22,665 | 23,603 | $ 23,571 |
Other (income) expense, net | $ 631 | $ 83 |
Pension and Postretirement Be31
Pension and Postretirement Benefits (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2017 | Mar. 27, 2016 | |
Pension [Member] | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Service cost | $ 952 | $ 998 |
Interest cost | 4,725 | 4,606 |
Expected return on assets | (6,281) | (5,507) |
Net amortization and deferrals | 2,694 | 2,132 |
Net periodic benefit cost | 2,090 | 2,229 |
Contributions to defined benefit pension plans | 700 | |
Expected contributions during the remainder of fiscal year | 27,900 | |
Postretirement [Member] | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Service cost | 172 | 132 |
Interest cost | 295 | 294 |
Expected return on assets | 0 | 0 |
Net amortization and deferrals | 0 | 0 |
Net periodic benefit cost | $ 467 | $ 426 |
Derivative Financial Instrume32
Derivative Financial Instruments, Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Apr. 02, 2017 | Mar. 27, 2016 | Dec. 25, 2016 | |
Not Designated as Hedging Instrument [Member] | Foreign Exchange Forward [Member] | Other Income (Expense) [Member] | |||
Derivative [Line Items] | |||
Derivative Instruments, Gain (Loss) Recognized in Income, Net | $ 3,581 | $ 3,255 | |
Not Designated as Hedging Instrument [Member] | Intercompany Loans [Member] | |||
Derivative [Line Items] | |||
Notional amount of derivative | 62,806 | 88,862 | $ 268,308 |
Cash Flow Hedging [Member] | Designated as Hedging Instrument [Member] | Foreign Exchange Forward [Member] | |||
Derivative [Line Items] | |||
Ineffective portion, amount of gains (losses) reclassified from other comprehensive earnings into earnings | (4,958) | 3,957 | |
Notional amount of derivative | $ 1,722,071 | $ 1,630,256 | $ 1,434,758 |
Derivative Financial Instrume33
Derivative Financial Instruments, Notional Amounts and Fair Values of Foreign Currency Forward Contracts Designated as Cash Flow Hedging Instruments (Details) - Cash Flow Hedging [Member] - Designated as Hedging Instrument [Member] - USD ($) $ in Thousands | Apr. 02, 2017 | Dec. 25, 2016 | Mar. 27, 2016 |
Foreign Exchange Forward [Member] | |||
Derivative [Line Items] | |||
Notional amount of derivative | $ 1,722,071 | $ 1,434,758 | $ 1,630,256 |
Fair value of hedged item | 35,449 | 71,928 | 65,929 |
Inventory Purchases [Member] | |||
Derivative [Line Items] | |||
Notional amount of derivative | 974,235 | 945,728 | 1,277,977 |
Fair value of hedged item | 35,711 | 60,520 | 69,748 |
Sales [Member] | |||
Derivative [Line Items] | |||
Notional amount of derivative | 423,828 | 290,181 | 82,072 |
Fair value of hedged item | 1,083 | 9,775 | 258 |
Royalties and Other [Member] | |||
Derivative [Line Items] | |||
Notional amount of derivative | 324,008 | 198,849 | 270,207 |
Fair value of hedged item | $ (1,345) | $ 1,633 | $ (4,077) |
Derivative Financial Instrume34
Derivative Financial Instruments, Fair Values Derivatives, Balance Sheet Location, by Derivative Contract Type (Details) - Foreign Exchange Forward [Member] - USD ($) $ in Thousands | Apr. 02, 2017 | Dec. 25, 2016 | Mar. 27, 2016 |
Not Designated as Hedging Instrument [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Net unrealized gain (loss) | $ (27) | $ 4,657 | $ (141) |
Not Designated as Hedging Instrument [Member] | Prepaid expenses and other current assets [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Unrealized gains | 0 | 5,854 | 0 |
Unrealized losses | 0 | (1,197) | 0 |
Net unrealized gain (loss) | 0 | 4,657 | 0 |
Not Designated as Hedging Instrument [Member] | Accrued liabilities [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Unrealized gains | 289 | 0 | 321 |
Unrealized losses | (316) | 0 | (462) |
Net unrealized gain (loss) | (27) | 0 | (141) |
Cash Flow Hedging [Member] | Designated as Hedging Instrument [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Net unrealized gain (loss) | 35,449 | 71,928 | 65,929 |
Cash Flow Hedging [Member] | Designated as Hedging Instrument [Member] | Prepaid expenses and other current assets [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Unrealized gains | 23,241 | 34,265 | 53,774 |
Unrealized losses | (3,204) | (2,075) | (6,890) |
Net unrealized gain (loss) | 20,037 | 32,190 | 46,884 |
Cash Flow Hedging [Member] | Designated as Hedging Instrument [Member] | Other Assets [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Unrealized gains | 39,032 | 51,839 | 26,454 |
Unrealized losses | (3,052) | (792) | (3,618) |
Net unrealized gain (loss) | 35,980 | 51,047 | 22,836 |
Cash Flow Hedging [Member] | Designated as Hedging Instrument [Member] | Accrued liabilities [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Unrealized gains | 9,041 | 8,481 | 1,900 |
Unrealized losses | (28,591) | (19,790) | (3,086) |
Net unrealized gain (loss) | (19,550) | (11,309) | (1,186) |
Cash Flow Hedging [Member] | Designated as Hedging Instrument [Member] | Other liabilities [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Unrealized gains | 149 | 0 | 1,349 |
Unrealized losses | (1,167) | 0 | (3,954) |
Net unrealized gain (loss) | $ (1,018) | $ 0 | $ (2,605) |
Derivative Financial Instrume35
Derivative Financial Instruments, Gain (Loss) by Hedging Relationship, by Income Statement Location (Details) - Foreign Exchange Forward [Member] - Cash Flow Hedging [Member] - Designated as Hedging Instrument [Member] - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2017 | Mar. 27, 2016 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion | $ 10,446 | $ 15,803 |
Cost of Sales [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion | 9,874 | 15,698 |
Sales [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion | 541 | 98 |
Royalties and Other [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion | $ 31 | $ 7 |
Segment Reporting, Net revenues
Segment Reporting, Net revenues by segment (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Apr. 02, 2017 | Mar. 27, 2016 | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Net revenues, external | $ 849,663 | $ 831,180 | |
Net revenues, affiliates | 0 | 0 | |
Operating Profit (Loss) | 78,343 | 85,916 | |
Corporate and Eliminations [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Net revenues, external | 0 | 0 | |
Net revenues, affiliates | (266,122) | (303,334) | |
Operating Profit (Loss) | [1] | 866 | (4,158) |
U.S. and Canada [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Net revenues, external | 451,577 | 443,648 | |
Net revenues, affiliates | 2,391 | 1,444 | |
Operating Profit (Loss) | 64,754 | 78,335 | |
International [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Net revenues, external | 345,281 | 345,037 | |
Net revenues, affiliates | 0 | 0 | |
Operating Profit (Loss) | 544 | 2,853 | |
Entertainment and Licensing [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Net revenues, external | 52,729 | 42,495 | |
Net revenues, affiliates | 3,502 | 4,701 | |
Operating Profit (Loss) | 11,346 | 5,442 | |
Global Operations [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Net revenues, external | [2] | 76 | 0 |
Net revenues, affiliates | [2] | 260,229 | 297,189 |
Operating Profit (Loss) | [2] | $ 833 | $ 3,444 |
[1] | Certain long-term assets, including property, plant and equipment, goodwill and other intangibles, which benefit multiple operating segments, are included in Corporate and Eliminations. Allocations of certain expenses related to these assets to the individual operating segments are done at the beginning of the year based on budgeted amounts. Any differences b etween actual and budgeted amounts are reflected in Corporate and Eliminations because allocations are translated from the US Dollar to local currenc y at budget rates when recorded. Corporate and Eliminations also includes the elimin ation of inter-comp any balance sheet amounts. | ||
[2] | The Global Operations segment derives substantially all of its revenues, and thus its operating results, from intersegment activities. |
Segment Reporting, Total assets
Segment Reporting, Total assets by segments (Details) - USD ($) $ in Thousands | Apr. 02, 2017 | Dec. 25, 2016 | Mar. 27, 2016 | |
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Total assets | $ 4,645,870 | $ 5,091,366 | $ 4,364,695 | |
Corporate and Eliminations [Member] | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Total assets | [1] | (2,920,086) | (2,856,651) | (3,408,370) |
U.S. and Canada [Member] | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Total assets | 2,618,808 | 2,559,792 | 2,751,504 | |
International [Member] | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Total assets | 1,964,343 | 2,368,761 | 1,983,747 | |
Entertainment and Licensing [Member] | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Total assets | 763,988 | 692,898 | 614,003 | |
Global Operations [Member] | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Total assets | $ 2,218,817 | $ 2,326,566 | $ 2,423,811 | |
[1] | Certain long-term assets, including property, plant and equipment, goodwill and other intangibles, which benefit multiple operating segments, are included in Corporate and Eliminations. Allocations of certain expenses related to these assets to the individual operating segments are done at the beginning of the year based on budgeted amounts. Any differences b etween actual and budgeted amounts are reflected in Corporate and Eliminations because allocations are translated from the US Dollar to local currenc y at budget rates when recorded. Corporate and Eliminations also includes the elimin ation of inter-comp any balance sheet amounts. |
Segment Reporting, Internationa
Segment Reporting, International Segment Net Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2017 | Mar. 27, 2016 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net revenue | $ 849,663 | $ 831,180 |
International [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net revenue | 345,281 | 345,037 |
Europe [Member] | International [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net revenue | 216,120 | 224,123 |
Latin America [Member] | International [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net revenue | 64,756 | 55,596 |
Asia Pacific [Member] | International [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net revenue | $ 64,405 | $ 65,318 |
Segment Reporting, Revenue by P
Segment Reporting, Revenue by Products (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2017 | Mar. 27, 2016 | |
Revenue from External Customer [Line Items] | ||
Net revenue | $ 849,663 | $ 831,180 |
Franchise Brands [Member] | ||
Revenue from External Customer [Line Items] | ||
Net revenue | 423,603 | 416,374 |
Partner Brands [Member] | ||
Revenue from External Customer [Line Items] | ||
Net revenue | 212,962 | 258,225 |
Hasbro Gaming [Member] | ||
Revenue from External Customer [Line Items] | ||
Net revenue | 142,913 | 100,228 |
Gaming including Magic the Gathering and Monopoly [Member] | ||
Revenue from External Customer [Line Items] | ||
Net revenue | $ 253,289 | 231,147 |
Sales Revenue Net Percent increase (decrease) | 10.00% | |
Segment Reporting, Additional Information about Entity's Reportable Segments | Hasbro's total gaming category, including the Hasbro Gaming portfolio as reported above and all other gaming revenue, most notably MAGIC: THE GATHERING and MONOPOLY, which are included in the Franchise Brands portfolio, totaled $253,289 for the first quarter of 2017, up 10%, from revenues of $231,147 for the first quarter of 2016. Hasbro believes its gaming portfolio is a competitive differentiator and views it in its entirety. | |
Emerging Brands [Member] | ||
Revenue from External Customer [Line Items] | ||
Net revenue | $ 70,185 | $ 56,353 |