Quarterly Financial Data (Unaudited – see accompanying accountants’ report)

12 Months Ended

Dec. 29, 2019

Quarterly Financial Information Disclosure [Abstract]

Quarterly Financial Data (Unaudited – see accompanying accountants’ report)

Quarterly Financial Data (Unaudited)

	Quarter
	First			Second	Third	Fourth		Full Year
2019
Net revenues	$	732,510		984,537	1,575,173	1,428,007		4,720,227
Operating profit(a)	36,127			128,333	297,210	190,380		652,050
Earnings before income taxes	29,595			6,108	259,746	298,761		594,210
Net earnings(a)	26,727			13,433	212,949	267,345		520,454
Per common share
Net earnings
Basic	$	0.21		0.11	1.68	2.02		4.07
Diluted	0.21			0.11	1.67	2.01		4.05
Market price
High	$	93.19		108.86	126.87	123.05		126.87
Low	77.34			84.61	103.04	92.59		77.34
Cash dividends declared	$	0.68		0.68	0.68	0.68		2.72
2018
Net revenues	$	716,341		904,458	1,569,686	1,389,161		4,579,646
Operating profit (loss)(b)	(80,419		)	87,588	313,336	10,547		331,052
Earnings (loss) before income taxes	(88,388		)	68,124	295,794	(5,128	)	270,402
Net earnings (loss)(b)	(112,492		)	60,299	263,861	8,766		220,434
Per common share
Net earnings (loss)
Basic	$	(0.90	)	0.48	2.08	0.07		1.75
Diluted	(0.90		)	0.48	2.06	0.07		1.74
Market price
High	$	103.39		93.00	109.60	107.57		109.60
Low	83.56			79.00	91.70	76.84		76.84
Cash dividends declared	$	0.63		0.63	0.63	0.63		2.52

(a) Operating profit and net earnings for the 2019 quarters include the impact of the following items:

• In the second quarter of 2019, net earnings were impacted by a $110,777 non-cash charge ($85,852 after-tax) related to the settlement of its U.S. defined benefit pension plan. During 2018 the Compensation Committee of the Company’s Board of Directors approved a resolution to terminate the Company’s U.S. defined benefit pension plan and commenced the termination process.

• In the third quarter of 2019, net earnings were impacted by a loss of $25,533 ($20,886 after-tax) related to hedging the British pound sterling purchase price of eOne. During the third quarter of 2019 the Company announced that they entered into a definitive agreement under which the Company would acquire eOne in an all-cash transaction, to be paid in British pound sterling. The Company hedged a portion of its exposure to fluctuations in the British pound sterling in relation to the acquisition using a series of both foreign exchange forward and option contracts. These contracts did not qualify for hedge accounting and, as such, were marked to market through other expense in the Company's Consolidated Statement of Operations.

• In fourth quarter of 2019, in association with the Company's agreement to acquire eOne in an all-cash transaction, the Company incurred certain transaction-related costs, as well as hedge gains on the British pound sterling purchase price in 2019. This resulted in eOne net gains in the fourth quarter of 2019 of $101,249 ($102,658 after-tax), comprised of the following:

◦ Net earnings were impacted by hedge gains of $139,666 in the fourth quarter of 2019 related to the foreign exchange forward and option contracts to hedge a portion of the British pound sterling purchase price for the eOne Acquisition;

◦ Net earnings were impacted by financing transaction fees of $20,568 in the fourth quarter, primarily related to the Company’s bridge financing facility which terminated unused in the fourth quarter of 2019;

◦ Operating profit and net earnings were impacted by eOne Acquisition related costs of $17,778 in the fourth quarter; and

◦ Net earnings were impacted by tax benefits of $1,409 in the fourth quarter of 2019 related to the eOne Acquisition related costs and Financing transaction fees.

• In the fourth quarter of 2019, net earnings were impacted by a $185 non-cash charge ($143 after-tax) related to the settlement of US pension plan benefits.

(b) Net earnings (loss) for the 2018 quarters include the impact of the following items:

• In the first quarter of 2018, Toys"R"Us announced a liquidation of its U.S. operations, as well as other retail impacts around the globe. As a result, operating profit (loss) and net earnings were impacted by incremental bad debt expense on outstanding Toys"R"Us receivables, royalty expense, inventory obsolescence as well as other related costs of $70,428 ($61,372 after-tax). In the fourth quarter of 2018, the Company made adjustments to the charges previously recorded based on its final settlement with Toys"R"Us, resulting in a benefit of $10,068 ($8,543 after-tax).

• In the first quarter of 2018, operating profit (loss) and net earnings were impacted by $17,349 ($15,699 after-tax) of severance charges, primarily outside the U.S., related to actions associated with a new go-to-market strategy designed to be more omni-channel and e-commerce focused. Additionally, in the fourth quarter of 2018, the Company recorded an additional $72,000 ($62,249 after-tax) of severance charges.

• In the fourth quarter of 2018, operating profit (loss) and net earnings were impacted by a goodwill impairment charge related to its Backflip business of $86,253, as well as impairments of certain definite-lived intangible assets totaling $31,303. These charges totaled $96,928 on an after-tax basis.

•

Throughout 2018, net earnings was impacted by adjustments to provisional U.S. Tax Reform amounts recorded in the fourth quarter of 2017 based on additional regulations issued, amounting to charges of $47,790 the first quarter of 2018, a benefit of $17,336 in the third quarter of 2018 and charges of $10,196 the fourth quarter of 2018.