Hasbro 3rd-Qtr Profit to Miss Forecasts, to Cut Jobs
10/12/0 11:25 (New York)

Pawtucket, Rhode Island, Oct. 12 (Bloomberg) -- Hasbro Inc.
fell as much as 20 percent after the world's No. 2 toymaker said
third-quarter profit was less than expected and it will close
plants and cut about 5 percent of its workforce to reduce costs.
Waning demand for Pokemon and Star Wars toys, a shortage of
electronic components and the effect of a strong U.S. dollar on
overseas operations has hurt Hasbro. Hasbro said in a statement
third-quarter earnings will drop to an estimated 6 cents to 10
cents a share, from 43 cents a year earlier. Analysts' average
estimate was 32 cents, according to First Call/Thomson Financial.
The toymaker will cut as many as 550 jobs and shut plants in
Cincinnati, San Francisco, and Napa, California. It will take a
fourth-quarter pretax charge of about $70 million for severance
costs and lease terminations, and discontinued or disappointing
product lines may result in another pretax charge of $70 million
to $100 million.
``The announcement sends a statement that management will be
getting down to basics in order to enhance profitability,'' said
John Miller, an assistant portfolio manager who helps oversee
about $4 billion at Ariel Capital Management, one of Hasbro's
largest shareholders with 13.6 million shares.
``We do not expect management to stop here. Whenever you have
management focus on core business, we look at it positively,''
Miller said.

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