Toy maker Hasbro Inc. parlayed its Hollywood tie-ins to boost second-quarter earnings on slightly improved sales, bucking an industrywide slump.
Toy sales have been declining throughout the recession because of consumers' diminished spending and retailers' efforts to curb inventories. Mattel Inc., the leading toy maker, reported a 19% second-quarter sales decline last week.
But Hasbro's action figures and other toys linked to Paramount Pictures'"Transformers: Revenge of the Fallen," a summer blockbuster, helped the company boost sales by 1% to $792.2 million. The company was also aided by toys already on the shelves linked to the release next month of "G.I. Joe: The Rise of Cobra," also from Paramount, a subsidiary of Viacom Inc.
Hasbro owns the property rights to Transformers and receives a small percentage of the movie's box-office receipts from Paramount. Under the agreement, it also gets to keep almost all of the toy and related sales. It has a similar arrangement for G.I. Joe. "Transformers," which made its debut last month, has rung up $772 million in box-office sales. Chris White, a Wedbush Morgan Securities analyst, called Hasbro's exposure to Hollywood "the big reason for its upbeat results."
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