The nation's second biggest toy company experienced soft sales in its games and girls' products, but its preschool and boys' segments experienced higher sales.
In March, Hasbro said it was cutting 170 workers because of the "underperformance" in Hasbro's U.S. and Canadian divisions, which are under new leadership. That led to $11.1 million in severance costs. The company also increased marketing and advertising in the U.S. and Canada in an effort to return to profit in those regions.
President and CEO Brian Goldner said in a statement that Hasbro still expects a higher percentage of its full-year revenue to come in the second half of the year as compared with previous years, since it has four movie tie-ins in coming months.
Those include "Battleship," which is tied to the popular Hasbro game and opens May 18. "Avengers" opens May 4, "G.I. Joe: Retaliation" opens June 29 and "Spiderman" opens July 3.
The toy maker also anticipates that its 2012 earnings and revenue will climb, when removing the impact of foreign exchange rates.
The company based in Pawtucket, R.I., said it lost $2.6 million, or 2 cents per share, for the period ended April 1. A year ago, it reported net income of $17.2 million, or 12 cents per share.
Excluding 6 cents per share in severance costs, earnings were 4 cents per share. Analysts polled by FactSet expected earnings of 8 cents per share.
There was one extra week in the current quarter.
Revenue dropped 3 per cent to $648.9 million from $672 million a year ago, hurt by unfavourable foreign currency exchange rates. This missed Wall Street's estimate of $667.6 million.
Hasbro shares fell $1.60, or 4.5 per cent, to $34.32 in premarket trading. Its shares have traded in a 52-week range of $31.36 to $48.43.
The preschool category benefited from strong sales of Sesame Street and Playskool Rescue Heroes products, including the Transformers Rescue Bots. Its boys' category was helped by strong sales of its Marvel and Star Wars brands as well as its new construction toy line, KRE-O.
Revenue slipped 16 per cent for the U.S. and Canada, but rose 14 per cent overseas. Entertainment and licensing revenue increased 19 per cent.
Last week rival Mattel Inc., whose brands include Barbie and Hot Wheels, reported that its first-quarter profit declined, weighed down by lower sales and costs tied to an acquisition.
© The Canadian Press, 2012
Read it on Global News: Global Edmonton | Toy maker Hasbro loses $2.6M in 1st quarter on severance costs, revenue declines