After months of hints that changes would be forthcoming to boost profits, Hasbro Inc. announced Dec. 10 it will eliminate 2,500 jobs by closing an Auckland, New Zealand, game plant and additional facilities at unnamed sites.
Officials said the firm also will invest $500 million in a share-repurchase program during the next several years. Officials did not say whether any of Hasbro's plastics operations or suppliers would be affected by the cuts.
``We plan to complete most of these actions over the next several months, and we expected to achieve approximately $350 million in total savings within five years, of which at least $40 million should be realized in 1998,'' said Alan G. Hassenfeld, the firm's chairman and chief executive officer in a prepared statement.
The 111,000-square-foot Auckland facility employs 100 and produces a line of Hasbro games, said spokesman Wayne Charness. He said he could not identify any other plants scheduled to close as a result of the reorganization.
Last month, the Pawtucket, R.I.-based firm said it would close an injection molding operation in El Paso, Texas, and move the operation to Tijuna, Mexico. One analyst said Hasbro is cutting back more than he expected.
``The moves appear to be motivated by a desire to improve profits and the company's share price, both of which have lagged behind Hasbro's biggest competitor [Mattel Inc.],'' said Sean McGowan, senior vice president of research at the investment firm Gerard Klauer Mattison & Co. Inc. in New York.
``I don't see how the moves will change revenues very much, but they should leave Hasbro in a better position for 1999.''