Here we are with TFW2005 Coverage of Hasbro 2012 3rd Quarter Earnings Conference Call.
Unfortunately, no major future plans were told about our beloved franchise, unlike last time. The reason for this may have been NYCC 2012 where Hasbro revealed much of their 2013 plans. Profits are down 4% last quarter and Hasbro wishes to return the “U.S. & Canada segment” to historical operating profit margins in the coming year. You can read all about this thanks to the Press Release our 2005 Boards member Hot Shot sharing with us.
However, there are things not written in black and white… things that may not look that big nor create a heavy impact. However, these little things matter to us; The Fans. What was said at the call might potentially impact the current Transformers Animation Series; Transformers: Prime. What is it? Find out, after the jump. At one point during the Conference Call it was casually told that Production Costs will get cut for Hasbro Hub related TV Shows. Later during the Q&A session a reporter asked Hasbro’s CEO Brian Goldner what was meant by that. The answer suggests a possible reason why we are getting only 13 Episodes for Season 3 of Transformers: Prime.
Question: Final Question… If you could just elaborate. You touched a bit on a prepared remark that I’m interested. You said you are reducing your production spend over the past several quarters… said due to efficiencies. Can you just elaborate more on that?
Answer: “Actually what we are saying is amortization has come down because ultimate revenue expectations have gone up. It’s one big driver on that. As we look at our ultimate revenue expectations for out programming because our performance we have on the television and digital distribution performance and revenue we are now expected to get from that programming; cross merchandising and program sales the amortization comes down.”
Question: You’ve been reducing your program production cash..
Answer: “Yeah, yeah the cash spend you really have to do when you have a successful TV Series… In fact Hasbro Studios TV Shows has outperformed other TV Shows on the Hub by 74% rating with 4 of the Top 10 shows on the network right now. So as you look at great performance of TV Shows, you are able to produce fewer episodes in subsequent series than you need for earlier series. You know, kids love watching episodes over and over again but you have to add an element of newness but you don’t need to spend to produce entire new series again. You can add 13 episodes or a 26 episodes to a pool of 52 already produced Episodes. So therefore you are able to… with a success TV Series… produce fewer in a year. Overall, Hasbro Studios has greenlit over 800 half-hours of programming. We also still have several hundreds of half-hour programming that we are producing for the network and also looking at whether there are successful tv series we obviously then spend less per new series because we are able to produce newer shows.”
… and there you have it folks. This suggests a possible reason why Transformers: Prime Season 3 is only 13 or 16 Episodes.
What do you think of this decision? Are you with it or against it? Do you think that having 52 episodes already for the show might also be a factor? Let us know what you think, on the thread associated with this news post.
Shmoptimus Prime
I think TFPrime having a shorter season will be good. Less filler episodes. A lot of TV shows are moving towards shorter seasons with higher production values and tighter plots. It's good for everyone, except for when you're waiting for a new season to start!
Infosaur
I'd love to gripe that part of the reason profits are down are due to the Yellow Menace peg warming.
But since they're talking NET profits, I could easily see transportation costs (ie: diesel fuel, trucking, shipping) and exchange rates hurting their bottom line as much as anything else.
RedAlert Rescue
Cheer up people it's just a year and half or so until the shelves will be filled full of Movie 4 Bumblebee toys
So there's something to look forward too – though he might look a little boring next to "The Yellow Arrow" from Beast Hunters.
To get my interest in Movie Bee he can't be another tiny deluxe that does nothing special he'd have to be a toy with real quality to it (Like Battle Blade Bumblebee had) one suggestion might be to either make the roof removable so he can form a convertable mode too and the roof is a also a hand shield – or to make him have pop up or swing out pannels to replicate the stealthforce mode to some extent.
A Plain Vanilla deluxe would have no presence at retail and would put many parents off if they'd already bought "Little Jimmy" some kind of plain Vanilla Bumblebee of the many sorts out since 2007.
I'm still looking quizzical over the lack of a really nice 1970's Camero Bumblebee toy of any kind (even a modelkit) and the lack of things like Scrapper, Leadfoot that were in the movie or even just things that might have made for interesting toys like a Voyager scale Jetfire that could still combine with one of the Optimus toys…. what with Voyager DOTM Optimus being covered in jet boosters him having no jetpack to wear seems really odd.. yet they never even made a Voyager scale wing back pack for it either for a giftset release.
I also think it's drives many consumers of all ages quite crazy when they make a huge bumblebee time and time again but no villans of that size, they had no large Optimus in the west until (more or less now) all those months they had zip in the way of a large Optimus Movie toy. Looking back their DOTM Megatron seems positively wimpy.
If they want to redeem themselves with a 4th Movie toyline they will really have to try harder – and actually get Bay to tell them stuff well in advance – heck they need someone inside ILM etc.. who works for Takara-Tomy the whole time. Hasbro are a Co-Producer of these movies they have no excuse in being incapabable of marketing their own movies properly or even making toys that look like the characters in some cases.
Sentinel Prime is a superb display piece in either mode – but he's also a complete pain in the tail pipe to transform – leaving many a little kid or parent completely at a lose as to how to transform him.
They need to make the transformation clever but not impossible and the toys need to be well fun.
Prime is a pretty good example he's a nice fun and good to handle figure with lots of joint movement and he's not to difficult to transform but who don't feel he's an F.A.B. either.
Perhaps they need to go back and look at the Animated toyline as despite the odd glitch they managed to make a line there that had a reasonable level of complexity but that also didn't strain the kids to much either – and they usually left you with a well movable action figure too.
I'm not going to get my hopes to high though (buy hoping they will do some more Constructicons for example). as the Movie toyline is always going to be a mix of mild interest and disappointment and isn't often going to be exciting me.
Enigma2K2
Wish the retailers would get their heads out of their arses and let Hasbro put product on the shelves… that didn't consist of 99.9% Bumblebees… He's turned into the official shelfwarmer of the lines. Add to that their tendency to, despite having the new lines come out, waste time trying to move overstock of whatever movie toys they had gathering dust in the back instead of tossing them in a discount bin. Yes, I've seen it.
My problems with Hasbro still exist. But I'm past blaming them for what happens at retail. Except the First Edition stuff.
RedAlert Rescue
There are ways to save a lot of money not on Production but on distribution and shipping.
But as I've been saying for months Hasbro need to have a serious conversation with the likes of Walmart and just twist their arms into taking larger cases with more characters (say 10 or 12 item deluxe cases or 8 figure voyager cases) and then release fewer new toys over the year basically I'm suggesting the waves come out each time like Launch waves do and that they remove refresh cases and cases with only 2 new toys in them completely.
They should also be trying to get things out for the major holidays and buying periods and not keep missing xmas – to do this they might need to warehouse more stock and not rely on retailers being reliable enough to order properly.
The number of times a case of 2 has not been properly distributed and then showed up on clearance shows they are doing things wrong.
I also feel that Repaints are not a bad idea – but perhaps the way to do it is to use them in a cleverer and more creative way – an example of a very good repaint was the Robots in Disguise Buildteam sold as twin packs in Constructicon colours.
A repaint or reissue of Classics Optimus Prime seems like something they perhaps really could have done. both versions of Universe had some Ok ideas but they also showed bad judgement with things like repainting the same moid to many times to quickly. or making the character and name fail to match up properly and so failing to homage what they are trying to homage (as with the Micromaster jets).
kaijuguy19
Beast Wars's second and third season episode count got shortend to 13 episodes each as opposed to Season 1's 26 episode count and it still had a good run.
Burnout
which is crap. 13 eps down from 22 or so is not a good sign at all.
TFXProtector
I realize that the basic gist isn't end of the world type stuff, but it's not exactly great. I dunno. We'll continue to see Prime (YAY!) but it'll be shortened and we won't see all the toys. (BOO!)
So, it's a mediocre meh.
TylerMirage
Pretty much this.
BigMetalUnit
With the clusterfuck that is the GIJOE sequel and the fact that there is no TF movie out right now you would expect a drop in sales. im sure just dropping the DOTM line before you get half of the characters made is kinda stupid on there part as well there was probably alot of money left to be made on that line considering most of the characters people wanted were never out in the U.S. Who wouldnt have wanted a leader megatron? seriously that was pretty stupid to discontinue a line before it even takes off completely
kaijuguy19
Why is everyone saying that Prime will end in season 2 when it's been confirmed by Combs himself a month ago that the show doesn't end at Season 3? All Hasbro's saying is that why Season 3's episode count is shorter then the first 2.
Cosablanca
Firstly, in most TRU in the UK pretty much only have OP, Megatron and loads of bumblebee.
I'm pretty sure most kids who watch the show would have bought them. They need to stop making new versions of the toys and just produce/sell different ones.
In the 80s there were one version of each toy and thats it. You didnt have 2-3 different Starscreams and Bumblebees. They need to just produce more characters and introduce more characters in the show. I know they will be doing this in the Beast Hunters series and I suspect that their sales will go up then.
OptimussSTAR
Did it occur to anyone that they might just be having problems with the show itself, and that's why they are saying the show may end. I find it hard to imagine the toys are not selling, I myself and my husband collect things with Optimus, and anytime we are in the different stores they can not hold onto any Transformers stock specially Optimus and Bumblebee. I just purchased a new Transformers prime Optimus prime one. I have also found at the bookstores the books and graphic novels are always flying off the shelves. So I find this a little hard to believe, I believe for some reason they are either not able to come up with another season story lines for any other seasons OR the show has lost ratings. This is my opinion anyway
Aernaroth
While this is the intuitive answer, the result is somewhat more complex. Looking at the numbers out this quarter, we see that a 1% increase in revenue resulted in a 20% increase in operating profit. Now, it's a bit tough to know if that relationship is accurate, or if there were a number of cost-cutting measures OR unforeseen expenses, but let's take it at face value. That means that Hasbro's operating profits are, roughly, 4-5% of their revenues. That means that for every dollar they sell, four to five cents represent their profits.
It could very well be that their revenues (which are paid by the retailer, not the customer) are simply not flexible enough to absorb a price reduction at this time. After all, their profit on a 20 dollar figure is roughly 80 cents, using the above calculation, and they're already trying to make their money through volume. If they reduce prices on that figure by even one dollar, they begin selling it at a loss, and that's bad business.
The sad, simple truth is that, in a lot of cases, we simply aren't worth the effort in Canada. We're a nation with 1/10th the population of the US, with a geography that means the same, if not greater shipping costs, and additional increased shipping due to border fees and taxes. Retailers may simply not be willing to invest in the same volume of product that they do in the US.
Kranix
Hasbro Get a F#@king clue! if every single living american in the usa were to buy 2 bumblebees of any type… there would still be so many left that the people could go nuy 3 more each and still have the shelves saturated with Bees…. not only that with all the bumblebees you produce is single handedly killing the environment in both production waste, but lso the resources you all waste producing that little yellow satan.
DJCHARTERS
to be fair horrid distribution is better then none at all. Im in the uk and we have nothing. The transformers sections are shrinking by the day. this is what has lead me to just buy masterpiece figures now. that and the fact the prime figures were terrible for the most part with a few exceptions. that is obviously just my opinion. They are not releasing main characters from the show and just repainting non descript characters as filler.
While i like generations the figures are just to small for me to spend on now so ive went masterpiece. Ive basically went from collectiong everyline to collectiong one. I cant be the only one that has done the same.
kaos
its actually been 6 months of considerable loss..i remember reading and seeing the reports around the beginning of summer..
sentinal prime
I tell you why sales are down I easy answer
They don't ship to Canada !!!!!!!!!!!!!!!!!!!!!!!!!!!
Still waiting on transformers generations classis's from 2011
Show us that they rich cats don't care about sales
Snark
Jesus, Hasbro lost 47 million on forex alone. Granted, that's not much of a surprise, but still, that's harsh.
Acidophilus
That reports looks predicable.
If the numbers really dropped for two or more quarters then maybe they would pay attention to all the complaints, and make/reverse to the changes that many of their customers have mentioned, or do something exciting to boost their sales. This could be seen as a positive report.