Hasbro Q4 2023 Earnings Call Transcript

Operator

Good morning, and welcome to the Hasbro Fourth Quarter and Full Year 2023 Earnings Conference Call. [Operator Instructions] Today's conference is being recorded. If you have any objections, you may disconnect at this time. At this time, I'd like to turn the call over to Kern Kapoor, Senior Vice President of Investor Relations. Please go ahead.

Kern Kapoor

Senior Vice President of Investor Relations at Hasbro

Thank you, and good morning, everyone. Joining me today are Chris Cocks, Hasbro's Chief Executive Officer, and Gina Goetter, Hasbro's Chief Financial Officer. Today we will begin with Chris and Gina providing commentary on the company's performance. Then we will take your questions.

Our earnings release and presentation slides for today's call are posted on our investor website. The press release and presentation include information regarding non-GAAP adjustments and non-GAAP financial measures. Our call today will discuss certain adjusted measures which exclude these non-GAAP adjustments. A reconciliation of GAAP to non-GAAP measures is included in the press release and presentation.

Please note that whenever we discuss earnings per share or EPS, we are referring to earnings per diluted share.

Before we begin, I would like to remind you that during this call and the question-and-answer session that follows, members of Hasbro management may make forward-looking statements concerning management's expectations, goals, objectives and similar matters. There are many factors that could cause actual results or events to differ materially from the anticipated results or other expectations expressed in these forward-looking statements. These factors include those set forth in our annual report on form 10-K, our most recent 10-Q in today's press release and in our other public disclosures. We undertake no obligation to update any forward-looking statements made today to reflect events or circumstances occurring after the date of this call.

I would now like to introduce Chris Cocks. Chris?

Chris Cocks

Chief Executive Officer at Hasbro

Thanks Kern, and good morning, everyone. For more than a year now, you've heard me outline Hasbro's strategy to refocus on play, behind a philosophy of fewer, bigger, better. Fewer SKUs that drive higher impact, bigger investment behind winning brands in more focused categories, and better innovation, driven by a renewed leadership team and a focus on kids, parents and fans, our consumers -- the lifeblood of Hasbro. We laid out a blueprint for a more focused and profitable company with a number of growth initiatives built on a diverse portfolio of some of the most iconic brands in the toy and game industry.

While business transformations take time, I'm pleased with how much we accomplished in 2023, setting the table for a 2024 punctuated by strong profit growth and momentum in renewing Hasbro's innovation engine. We're entering 2024 with a healthier balance sheet, a leaner cost structure and an operational rigor that will maintain and build on these improvements in the quarters ahead.

In 2023, we took substantial action to bolster our balance sheet. At the end of the year, we closed our deal with Lionsgate on eOne Film & TV, allowing us to focus our investments on higher return, play focused initiatives across toys, games and digital.

Proceeds from the deal allowed us to reduce our debt by approximately $400 million. As we shift our entertainment strategy to an asset light and partner led model, we took a $1 billion impairment, a non-cash item in Q4, which reflects the sale of eOne, and a change in outlook for the balance of our owned and operated production efforts.

This shift frees up more capital for us to reinvest in toys, games and particularly our digital future. Between hard work from our sales and operations teams and some of the financial actions we took at the end of the quarter, we entered 2024 with inventories down over 50% year-over-year, which is well below 2019 levels. We also took steps to improve our structural profitability, exiting a number of low or negative profit businesses that we have shifted to a licensed-out model.

Finally, we are driving better than expected cost savings through our operational excellence work, unlocking crucial investment capacity as we seek to connect with fans of all ages and across all play patterns.

Previously, we communicated $350 million to $400 million in annual run rate savings. We're updating our target to $750 million of gross savings by the end of 2025, with half of it dropping to the bottom line. This allows us to reinvest in our business, meaningfully improve our cash flows and return cash to our shareholders, which we are committed to continuing through our category leading dividend. Since I became CEO in 2022, Hasbro has returned almost $1 billion to shareholders and paid down over $0.5 billion in debt.

While 2023 was challenging, and we still expect the toy industry to face near term headwinds, we believe we're taking the necessary steps to turn around our consumer products business. Wizards and digital gaming is coming off a banner year led by Magic's Universes Beyond, the success of Baldur's Gate III from our partners at Larian and Monopoly Go from Scopely. 2024 is about returning consumer products to profitability, investing for long-term momentum in games and driving significant improvements in Hasbro's bottom line, fueled by operational discipline and renewed product innovation.

In short, we're putting all the right pieces together to keep investing in our growth initiatives while expanding the ways our franchises reach fans through digital games. We expect the next year will likely see continued headwinds in the toy category. We're exiting 2023 with our retail inventory down around 20%.

While we think Hasbro's retail inventory is in a healthy position across the industry, a lot of older discounted inventory still remains in the market. The consumer remains value conscious, and we anticipate entertainment will be less of a tailwind in the year ahead behind a reduced box office slate. Anticipating these headwinds, we made necessary choices to get our cost structure and inventory positions healthy, accelerating a number of cost savings initiatives by several quarters.

Since I became CEO, we have significantly enhanced our consumer insights capabilities and upgraded our design and toy leadership. In 2024, we'll see more and more of the resulting innovation improvements, as these capability upgrades come to market across our portfolio. As such, we believe we're in a good position to at least pace the industry this year, with innovation and share trends accelerating to ahead of market as we head into 2025.

Turning around a product pipeline is key, with the right people and the right insights. At the end of the day, it's all about great product. In the back half of 2023, we started to see the first evidence of our new team and products working. Take Furby for example. This was a product we took our time testing and iterating based on consumer insights. It paid off as Furby was one of the top new toy introductions in 2023.

We continued the Furby craze in December with the launch of Furblets, another hit introduction, and I'm excited to continue building this franchise in 2024. 2023 was also a strong year for our Transformers franchise on the back of a hit movie, Transformers, Rise of the Beasts, from our partners at Paramount, driving point of sale growth of 35%. We have some exciting activations planned as we celebrate the brand's 40th anniversary in 2024, as well as the star- studded animated movie Transformers One, coming this summer along with fresh merchandise.

This year also marks Peppa Pig's 20th birthday. We'll be celebrating with new, innovative products and an entertainment special featuring A-list talent Katy Perry and Orlando Bloom. After gaining share in the arts and crafts category in 2023 with another strong year including our ultimate ice cream truck, the Playdoh team continues to innovate. Expect more creative surprises and new cross brand collaborations in the year ahead.

In action figures, we are leaning into our category leading collaboration with the Walt Disney Company for their Marvel Superheroes Assemble marketing campaign, featuring new price points and products across our lines, including all new preschool fun with Spidey and his amazing friends.

For Star Wars, we're excited to expand our best-selling Lightsaber Forge, Kyber Core series and introduce our new 799 Epic series Four Inch action figures. We saw an incredibly strong launch from Beyblade X last year in Japan from our partners at Takara Tomi, and are eagerly anticipating the U.S. launch this summer, what we believe will be one of the hottest new toys of 2024. It's an exciting product that we think longtime collectors and kids fresh to the franchise will be thrilled with.

The blaster category continues to be under pressure, but we also continue to believe this is a strong and enduring play pattern for fans of all ages. This year we'll be introducing new innovation into the category, featuring a new performance dart technology, pop off-the-shelf design and attractive pricing up and down the range.

Board games continues to be a leading category for us, and one we anticipate will grow in the year ahead. Twister Air was the number one new game across the G10 markets in 2023, according to Circana. Thanks to an innovative new augmented reality experience, you're going to see a renewed focus on expanding genres, leveraging our reach and distribution strength to introduce more cool new games than ever, and working with some of the brightest designers in the industry to give their games a platform they deserve.

Whether it's adult party games, family card games, casual strategy, or extending mega hits like Monopoly, 2024 will be a big year for gaming from Hasbro. Speaking of games, wizards and Digital outperformed our guidance in 2023, driven by a series of blockbuster hits. Magic had another record year in '23 with a string of amazing new sets, including our best-selling set of all time, the Lord of the Rings, Tales of Middle-Earth. While a product like Lord of the Rings creates a tough comp in 2024, we have some unique sets that fans are eagerly anticipating, including March's Fallout, a new commander focused Universes Beyond product line, this summer's modern Horizons Three, the sequel to our prior bestselling set of all time, and this September's charming new world, Bloomborough. We continue to see the power of our franchises play out with our digital licensing partners.

Monopoly Go from our partners in Scopely is the number one mobile game launch of all time in the U.S., outperforming the launches of global phenomena like Pokemon Go and Candy Crush, and the fastest mobile title to reach $1 billion in the U.S., and the game continues to break records.

In Q4 alone, the game drove more than $800 million in revenue worldwide for Scopely. As far as our financial participation goes, for revenue and profit, it's like having the equivalent of $1 billion movie supporting Monopoly, except every year, with the impact growing sequentially as the game works through our minimum guarantees and marketing allowances.

Baldur's Gate III from our partners at Larian continues to win awards around the world, and is one of the highest rated video games of all time. We expect a long tail into 2024 and beyond for this mega hit. Last but not least, we have a compelling new lineup of adventures, core rulebooks and new digital first offerings for D&D as we celebrate this iconic brand's 50th anniversary. We'll launch the biggest update to fifth edition since its introduction in 2014, reinventing everything from the artwork of our iconic monsters to new classes to new mechanics to bold new ways to bring to life the world of D&D digitally.

All of this will add up to more and more impressive product as the year goes on, leading into an even brighter 2025. We look forward to sharing more about 2025, all new brands, entertainment collaborations, and a chance to really show what this team is capable of later this year.

Wrapping up, 2023 was a challenging year, but not without significant wins. Wins we believe Auger the Hasbro to come, a company rededicated to play, innovation and fun for fans of all ages. Last year we launched a top toy with Furby. We won a game of the year award with Twister Air, and we wowed tens of millions with Monopoly Go, Transformers, Rise of the Beast, Baldur's Gate III and Magic Lord of the Rings, all while cleaning up the business, selling eOne, paying down debt and clearing excess inventory, which makes for a healthier, stronger Hasbro to start 2024. I'm excited to see the results to come.

I'd now like to turn over the call to Gina to share more about our detailed results and to provide guidance for the year. Gina?

Gina Goetter

Chief Financial Officer at Hasbro

Thanks Chris, and good morning, everyone. 2023 marked an important milestone in our transformation towards a more streamlined and profitable toy and game company. As Chris mentioned, transformations take time and amidst the tough industry backdrop, I'm proud of the progress the Hasbro team made over the past several quarters in resetting the business and getting us in the best position for 2024. Before I touch on the financial highlights from the past year, I want to recap three major actions we took and how to think through their impacts. First, we successfully closed the sale of the eOne film & TV business to Lionsgate, and we use the proceeds to reduce debt by $400 million, which will result in annual interest expense savings of approximately $25 million.

In addition to reducing our leverage, the sale of eOne frees up capital to invest in higher growth initiatives, while allowing us to continue monetizing Hasbro IP in an asset light structure. In conjunction with the sale and the change in the business strategy for family brands, namely Peppa Pig and PJ Masks, we recorded a non-cash goodwill and intangible asset impairment of approximately $1 billion, which you will see in our reported results. As we look to 2024, besides the reduction in interest expense, we also expect to see an improvement in operating margin as well as an improvement to cash flow given the reduction in production spending.

Second, in Q4, we accelerated efforts to clean up our excess inventory. As I had mentioned last quarter, we were focused on starting 2024 in a cleaner position and would remain agile in taking actions consistent with broader category momentum. While we landed within our revenue guidance, we did not see the holiday season pickup that we were hoping for, and as a result took more aggressive actions in bringing inventory levels down over 50% from the prior year.

Our inventory is now running well below pre-pandemic levels, and we believe this improved position will allow us to drive higher value retail distribution and return focus to upcoming toy and game innovation. We also expect annual savings of roughly $10 million from exiting overflow locations previously used to store excess inventory. And while this was the right decision for the long- term health of the business, the near-term impact from accelerating this cleanup resulted in a roughly $130 million non-cash impact to operating income.

Lastly, as part of our operational excellence program, we made the difficult decision in Q4 to reduce the size of our workforce. While these decisions are never easy, this move will enable cost savings which will improve profitability and fuel investments towards long-term growth around toy and digital games innovation.

Moving to our financial results and business segment highlights. In Q4, we saw a continuation of the trends seen throughout much of the year. Total Hasbro revenue of $1.3 billion was down 23% versus last year. Wizards of the Coast in digital gaming revenue increased 7% behind ongoing contributions from the award-winning Baldur's Gate III and Monopoly Go. Consumer products declined 25% due to the planned business exits, broader category declines, and an enhanced focus on clearing inventory.

Q4 adjusted operating loss of $50 million was down year on year, mostly driven by nonrecurring and noncash charges of $168 million, which includes the $130 million inventory write-off. We believe the cleanup efforts are behind us as we are starting 2024 at much healthier levels compared to prior years, and our retail inventory is at an acceptable level.

Q4 adjusted net earnings were $52 million, with diluted earnings per share of $0.38, also down versus the prior year, primarily due to the aforementioned nonrecurring charges. For the full year 2023, total Hasbro revenue of $5 billion was down 15% versus 2022, and within our previously stated guidance range. Wizards of the Coast and digital gaming revenues grew 10% ahead of our guidance, benefiting from the success of Baldur's Gate III Magic, the Gathering and Monopoly Go.

Consumer products revenues were down 19% for the full year, driven by planned business exits, softer industry trends and stronger inventory management on behalf of our retailers. Adjusting for the exited brands and markets, revenue would have declined by 15%, and despite the tougher category backdrop, we delivered some bright spots within our toy portfolio, including Transformers, Twister Air, Furby and GI Joe.

On a reported basis, the entertainment segment revenue declined by 31% as the writer and actor strikes impacted content deliveries. Family brands revenue grew 6% from streaming deals of animated content in support of Hasbro's brands.

Total Hasbro Inc. 2023 adjusted operating profit was $477 million, down 48% versus last year, primarily driven by the non-recurring expenses as well as lower revenues. 2023 adjusted net earnings of $349 million, or $2.51 per diluted share, was down 44% versus last year. Besides the charges for inventory, earnings were negatively impacted by content impairments and higher royalty expense, partially offset by our cost savings program and a one-time tax benefit.

Operating cash flow for the full year was $726 million, well ahead of our guidance and nearly double from the prior year, driven mostly by a working capital benefit of approximately $350 million, due to the inventory cleanup efforts. We ended the year with $545 million in cash on our balance sheet and reduced debt by approximately $500 million. We also returned $388 million of capital to our shareholders via dividends.

Before I move to guidance for 2024, I want to frame how we are thinking about the year ahead from an operational perspective, and in particular how we're looking to turn around the consumer products business. In 2023, we took the necessary steps in our transformation to reset the business. This year, with the right foundation in place, we are focused on reinvigorating innovation across the portfolio, while continuing to drive operational rigor, which we expect to pave the way for sustainable, profitable growth.

The near-term model that we're building is one where cost productivity provides the fuel to innovate and grow the business, and in 2024 there remains a significant opportunity to improve the underlying profitability while rebuilding its innovation engine. These two go hand in hand and align with our overarching strategy of focusing on fewer, bigger and better brands.

Over the past several quarters, we have been mobilizing around this imperative and taking actions to simplify and prioritize resources on our largest portfolios and biggest bets. One of the single biggest contributors to complexity reduction relates to our product portfolio.

Moving into 2024, we have eliminated about half of our SKUs. These SKUs were only 2% of our revenue and were duplicative and unprofitable, clogging the network and creating cost for us and our retailers. Along similar lines, we made the decision to move to an out-license model for brands, where we determined their respective path to scale and profitability as an owned and operated entity did not meet our internal threshold. In 2024, FurReal friends and EASY BAKE oven will transition.

While there are short-term impacts to revenue from this model shift, we ultimately can expect greater operating profit dollars from out-license IP, and it allows us to focus resources back to our core brands.

In 2023, we started the work to streamline our supply chain and improve the efficiency of the organization, and in 2024 we will be continuing these efforts by reaching further upstream to unlock value in our product design and manufacturing processes. We are taking an organization-wide focus across the supply chain, brand teams, product development, procurement and manufacturing to identify waste and redefine the right design to value equation for each product.

Ultimately, this will culminate in higher margins and contribute to an improved play experience. We started this work last year on select brands within our Hasbro gaming portfolio and will be rapidly extending this approach to two of our biggest brands, Nerf and Play Doh. Also, within our supply chain, we are building new capabilities within planning and forecasting to ensure that inventory levels, both owned and retail, remain within the desired thresholds.

We made significant progress coming out of 2023, and these updated processes and tools will ensure that we maintain a healthy inventory position.

Since coming on board at Hasbro, I've talked about the imperative to bring costs down within managed expenses to stop the dynamic of overhead growing faster than revenue, particularly within the consumer product segment. In December, we announced the next round of actions to address the organizational structure.

We have also introduced zero-based budgeting as a tool to help us optimize our spending and ensure dollars invested are driving the right actions in support of our strategy.

And finally, we are continuing to enhance our capabilities around consumer insights, revenue growth management and marketing effectiveness as core drivers in strengthening our foundation and enhancing product development.

Looking forward to the 2024 holidays, we have more innovation compared to last year, that's backed by insights and stronger pricing precision. This, coupled with stronger planned execution with our retailers, will enable Q4 growth across the toy business.

Turning to guidance for 2024 and looking more closely at the two main operating segments, total Wizards revenue is forecasted down 3% to 5%. The decline is primarily a result of the strong growth delivered in 2023 behind the launch of Baldur's Gate III and the Magic Lord of the Rings set. Looking at each of the pieces, we are planning for growth within D&D with the upcoming update of the fifth edition and the continued expansion of D&D Beyond. Magic will have the same number of releases in 2024 as last year, but revenue will be flat to down as we comp Lord of the Rings. It's important to call out that Magic will be back to growth in 2025 as we expand our universes beyond lineup.

Licensed digital games will be relatively flat. The revenue from Baldur's Gate III will begin to taper down as we move through the year and will be partially offset by the continued momentum of Monopoly Go. With the success of the game, we are now anticipating that we will begin to record revenue higher than the contract minimum guarantee in the back half of the year.

From a phasing standpoint, we expect Wizards revenue to grow in the front half with the decline coming in the back half as we comp the huge launches. Wizards operating margin will be between 38% and 40%, which will be up 200 basis points to 400 basis points versus last year. The margin improvement is a result of a favorable mix shift within digital, lower royalty rates across Magic and strong cost management within operating expenses.

Margins are also benefiting from supply chain cost productivity more than offsetting the inflation. For consumer products, revenue will be down 7% to 12%. About half of the decline is due to actions we've taken to improve profitability, including the planned business exits, as well as a reduction in unprofitable closeout revenue. Given the significant inventory cleanup executed at yearend. The other half of the decline is a result of prevailing category trends.

Overall, we are planning to grow share in the categories in which we compete, and are leaning into innovation green shoots with step ups in Hasbro gaming, Beyblade, Play Doh, Furby and Nerf, and we are also adopting a more agile approach with our marketing dollars to better target consumers and increase the effectiveness of the spend. We are forecasting revenue trends will improve as we move through the year with steeper declines in Q1 and Q2 and stabilization coming in the back half of the year behind innovation, marketing effectiveness and maintaining healthy retail inventory levels heading into the holidays.

A key focus for 2024 is improving the profitability of toys, and we are forecasting operating margins to be between 4% and 6%, which is 500 basis points to 700 basis points better than last year. Approximately 400 basis points of improvement is driven by the lap of the non-recurring inventory charges, and this is almost completely offset by the anticipated volume declines and associated deleverage impact.

The additional margin expansion is driven by a combination of favorable product mix due to less closeout volume, supply chain cost savings more than offsetting inflation, reduced complexity across the network, and operating expense reductions. Margin will also be positively impacted from the work on SKU elimination and design to value which I mentioned earlier.

For entertainment, stripping out the impact of the eOne divestiture revenue will be down approximately $15 million versus last year, and operating margin will show significant improvement driven by operating expense reductions as well as lapping the impact of the D&D movie impairment in 2023. We will continue to report entertainment as a separate segment for 2024, albeit on a much smaller base.

As part of the 2024 guidance, we are increasing our gross cost savings target through 2025, from the $350 million to $400 million communicated in December to $750 million. Through 2023, we have delivered approximately $220 million of gross cost savings and anticipate a sizable step up as we move through the next two years. Roughly half of the gross cost savings will drop to the bottom line as we focus on improving profitability and the remaining dollars will be reinvested back into the business to support growth initiatives, including the reinvigoration of toy innovation and the continued investment in the gaming business.

With the improvement in operating margin across all segments, total Hasbro Inc. EBITDA is forecasted to be $925 million to $1 billion, up $215 million to $290 million versus the prior year. The positive impact from the cost structure reset as well as the lap of the onetime inventory cleanup in 2023 is more than able to offset the revenue decline and cost inflation.

We are planning for relatively flat owned inventory levels in 2024 and estimate approximately $225 million of project capital to support growth initiatives and invest back into the infrastructure, as we continue to rebuild, the underpinning of the operation.

Ending cash will be slightly down versus 2023, driven by relatively flat owned inventory levels, increased capital project spending and additional costs associated with the restructuring actions announced in December.

From a capital allocation standpoint, our priorities remain to first, invest behind the core business, second is to return cash to shareholders via the dividend, and third, to continue progressing towards our long-term leverage targets and pay down debt. As you heard Chris mention, we remain committed to our category leading dividend and believe that the changes that we've made within working capital to free up cash, as well as the changes we're making on the broader cost structure, provide enough cash flexibility to deliver on the capital allocation priorities.

The board has declared our next quarterly dividend payable in May and keeping consistent with industry best practices as we move through 2024, we will be shifting the declaration of the dividend to more closely align with the record dates.

And to close, looking out beyond 2024, we expect that the consumer products business will return to low single digit revenue growth, and that Wizards will return to mid to high single digit revenue growth. With our step up in cost savings, we remain committed to getting to 20% operating margin with the potential to reach that milestone before 2027.

And with that, I'll turn it back to Chris to wrap up.

Chris Cocks

Chief Executive Officer at Hasbro

Thanks Gina. Turnarounds take time, and for our toy business, we are still in the early innings. While we're likely to face some near-term industry headwinds in 2024, and we're comping a better than planned 2023 for Wizards, the work we have done under the hood to strengthen our balance sheet, upgrade our planning and right size our inventory, are a strong foundation to build from. I want to thank the teams at Hasbro for driving this and putting our fans first.

This year is all about execution. As we build on that foundation, drive our profitability and reinvigorate our innovation pipeline for category share gains in 2024 and renewed top line growth in 2025 and beyond. We'll now pause to take your questions.

Operator

Thank you. We'll now be conducting a question-and-answer session. [Operator Instructions] Our first question will be from the line of Eric Handler with ROTH MKM. Please proceed with your question.

Eric Handler

Analyst at Roth Mkm

Good morning. Thanks for the question. A lot to digest here. I wonder if you could talk about what the retail situation and your cost structure looks like International versus North America.

Chris Cocks

Chief Executive Officer at Hasbro

Sure. I think perhaps Gina and I will answer this question. Good morning, Eric. Generally speaking, we're feeling pretty good about where our retail situation is in the U.S. and Europe. In terms of retail inventory, we're down about 20% year-over-year. That translates to about a four-week improvement on [Technical Issues] of supply. So, between Europe and the U.S., we generally have about 17 to 20 weeks of supply at our major retailers, which is about what we'd like to see. It's about what our normal is, pre-pandemic.

So, generally speaking, that means we neither see retail inventory as a tailwind nor a headwind, which is nice, because over the last year or so, it's been decidedly a headwind, as retailers have been trying to right-size their inventories.

I think if we have any concerns inside of retail, it's that there's still a lot of industry discounted merchandise, particularly in what we would call the growth channel or kind of like value resellers. That's going to take a quarter or two to work through. But again, based on our inventory position, we have very little aged inventory, and any aged inventory we have has a PO associated with it. So, we feel in a generally good position. Gina, anything to add?

Gina Goetter

Chief Financial Officer at Hasbro

No, Eric. The second part of your question about the profitability between North America and our international markets. North America is our highest margin market. Within international, a couple of things that draw that margin profile down. One is within the allowances and just how we intersect or interact with the retailers, that is a bit more costly than what we have in the U.S. And the second piece is really within our overhead structure to support the international business. Both of those pieces we are working to address. So, through our initiatives of revenue growth management, that is squarely focused on all of that cost, that's sitting between gross revenue and net revenue. And then the second piece on overhead, all of the cost savings initiatives that we've put into motion will start to attack the cost structure broadly in North America as well as with International.

Eric Handler

Analyst at Roth Mkm

Great. And then, just as a follow up, Chris, you've talked before about the inevitability that, you know, Magic has to see a slowdown just because of [Indecipherable] of large numbers in revenue. And D&D was supposed to pick up the torch and drive higher growth. I wonder if you could talk about maybe some of the key drivers with D&D that as you look at over the next few years, what's going to build that business even more.

Chris Cocks

Chief Executive Officer at Hasbro

Yeah, for sure. So last year we were fortunate in that both Magic and D&D were growers for us. The Magic tabletop business was up probably in the 3% to 5% range. We had a little bit of attrition on Digital, but still the business was up low single digits, and D&D was up over 75% on a total brand basis. I think the contributors for D&D's growth last year will be very similar to what they'll be moving forward. We continue to think D&D Beyond was an excellent acquisition.

It really is the way increasingly people are playing tabletop role playing games. I think it's an excellent platform for us to build upon and expand the ways that people can play, the ways that people can experience theater of the mind, and also for us to distribute and showcase a more diverse set of content, whether that's Universes Beyond Style content like we do with Magic, or our major creators' content, or user generated content. So, I think you'll see more from that on the tabletop side. We continue to have a robust entertainment slate on D&D that we're working with several partners behind, notably the new streaming series from Paramount that we're partnering with them on.

And then video games will clearly be a huge leg up on the D&D business. Baldur's Gate III is one of the seminal role playing games of all time. It's won multiple game of the year awards. Our partners at Larian really knocked it out of the park with that, and were fantastic to work with. Baldur's Gate III is just the first of several new video games that will be coming out over the next five to 10 years, that I think will continue to power that franchise.

And really, I think the three combined, continued innovation on tabletop powered by D&D beyond, targeted entertainment, working through partners in an asset light model, and then great video game content through licensees and through our own internal studios, I think the future is bright for that brand.

Eric Handler

Analyst at Roth Mkm

Thank you very much.

Operator

Our next question is from the line of Christopher Horvers with J.P. Morgan. Please to see with your questions.

Christopher Horvers

Analyst at J.P. Morgan

Thanks, and good morning. So first a clarification. Did you say you expect consumer products to be flat in 3Q and then up in 4Q in that mix? How are you thinking about Nerf growing again? And to what extent are you taking in a shorter holiday calendar next year? And as a part of that fourth quarter question, could you mention what the specific lift in 4Q '23 was from clearance sales?

Gina Goetter

Chief Financial Officer at Hasbro

All right, I will try to dissect all of those for you, Chris. You've got the phasing generally right within CP. So, as we think about the guide of seven to 12 down, you're going to see steeper declines in Q1 and Q2, similar to what we saw playing through Q3, kind of the average what we saw playing through in Q3, Q4. As we look at Q3 of '24, we start to stabilize. And as we move into Q4, we're planning for growth.

As we think about which brands are going to carry it, it's really behind the strong innovation that we're putting in, Nerf being one of them. So, we do have some innovation that's coming that will be a market kind of in the back half of the year as we head into holiday.

In terms of your last question on the lift, specifically from closeouts, I don't know that I have that number to an exact extent. What I would say is that our close out volume and revenue was generally consistent with what we saw play through the year prior. There wasn't a huge delta from previous years. And then coupled that with all of the efforts that we took to clean up inventory, as we're looking here in the front part of the year, we're seeing that close out volume come down quite significantly. So, nothing I would call out as different as we play through Q4.

Chris Cocks

Chief Executive Officer at Hasbro

As you think about the back half, Chris, I'd be really looking at Beyblade X as a huge launch for us. It did many orders of magnitude larger in the launch in Japan last year versus Beyblade Burst from 2016. We're expecting it to be quite a runner. And the early feedback from the toy fairs is our retailers are getting behind it as well. We have some really cool innovation across price points for Play Doh that I think will continue to the run on that brand, both building share and building point of sale and sell in. And then we have quite a lineup of board games that will be coming out throughout the year. But generally speaking, we have a good Q4 for our board games, and we think this year will be no exception.

Christopher Horvers

Analyst at J.P. Morgan

Got it. And then on the Magic business, I guess, how many of the larger releases that you mentioned would you expect could eclipse $100 million? And then from a Universes Beyond perspective, was there any shift into '24 from IP partnerships that you were expecting in '23? Thank you.

Chris Cocks

Chief Executive Officer at Hasbro

Sure. So last year we did six premiere sets per year, which is like large sets that go across formats. I think last year, five of our six premiere sets eclipsed $100 million. I don't think we have a specific forecast for each of the premiere sets this year, but we will have six sets this year. We think actually we'll have probably slightly less kind of secondary sets or secondary SKUs associated with Magic. And so, we're projecting flat to slightly down for the brand. So, I think you can do the math and say it's roughly about the number of equivalent sets that are hitting that $100 million bogey.

As you think about Universes Beyond, last year, we had our first, what we would call premiere set for Universes Beyond. That was Magic Lord of the Rings, that did over $200 million in under six months. This year, we have some smaller universes beyond sets. The first one is going to be fallout, which will come up in March that won't be at the same scale or size, but will do better than what a typical commander set would do. But starting in 2025, we're going to have two premier Universes Beyond sets as part of our mix. And we believe the brands that will be shipping in 2025 have the same kind of carrying power as the Lord of the Rings. The one that we've announced will be in the front half of the year. And that's Final Fantasy, which is just a juggernaut in role playing games.

We've announced partnerships with a host of other brands, Marvel being one of the last ones that we kind of talked about. There'll be multiple sets associated with that. So, for '25 going forward, you should expect to see as part of our six premiere sets per year, two of them will be universes beyond branded. And we think we'll have a similar uplift to what we experienced with Lord of the Rings. So, you know, that's underlaying a lot of our bullishness on the growth for Magic.

Christopher Horvers

Analyst at J.P. Morgan

Thank you so much.

Operator

Our next questions are from the line of Arpine Kocharyan with UBS. Please, just you with your questions.

Arpine Kocharyan

Analyst at UBS Group

Hi, thanks for taking my question. So, EBITDA finished the year at around $700 million, and you expect around $250 million of incremental cost days in 2024. But then you're probably annualizing cost days from 2023 with some kind of underlying decline in EBITDA. Could you just maybe bridge to the puts and takes of 2024 EBITDA guide for the year for us, because there's also cost to those cost savings, as I understand. If you could just go through the puts and takes, and then I have a quick follow up for Chris.

Gina Goetter

Chief Financial Officer at Hasbro

Got it. Sure. Very happy to do so. So, you kind of named some of them. As we think about the build from where we stood in the $750 million, keep in mind that we have that one time all those non-recurring charges come back, that is a benefit to us next year, that becomes a tailwind. Almost completely offsetting that tailwind, though, is the volume coming down, the revenue coming down. So, the one-time benefit is offset then by the volume kind of de- leved impact.

Overall, we have supply chain productivity that is going to be offsetting inflation. So, when you think about the cost saves, that's one piece of the cost saves -- supply chain productivity. The second big piece really is what's happening within our operating expenses. So, when you think about the people cost as well as just broader managed expense savings, that becomes an adder [Phonetic] back for us as we think about 2024.

And the last piece that is positive is just the overall mix of our business. So not only within [Indecipherable] where we have this continued mix into digital, but within the CP business as well when we again took out those actions from a close out standpoint, the volume that we're going to be moving through in 2024 is higher profit volume for us.

So those are some of the big puts and takes. Really, the big negative for us as we head into '24 is just what's happening on the revenue line and the impact that's having.

Arpine Kocharyan

Analyst at UBS Group

Great, thank you. And then, Chris, you had talked about $500 million of D&D business over a three-, four-year period. I was wondering if that's still the guidance for D&D. I know you addressed some of that earlier, but if you could just go over kind of the long-term growth prospects for that business in terms of sizing it for us, similar to how you guys communicated in October Analyst Day. I know you're not ready to update that guidance, but just sort of. Is that $500 million still the right number to think about? Thanks.

Chris Cocks

Chief Executive Officer at Hasbro

Yeah, no worries. Hey Arpine, by the way, I heard you have a new child. Congratulations.

Arpine Kocharyan

Analyst at UBS Group

Thank you. I appreciate it.

Chris Cocks

Chief Executive Officer at Hasbro

We always appreciate it when people make customers. Indeed. I would say that guidance holds. The D&D brand and our games portfolio overall is trucking along at a similar pace as we expected, that guidance was more of a 2027-ish time frame. I think a little bit will depend on certain calendars associated with certain video games, and there's a certain amount of schedule slippage that you get with that. But generally speaking, we feel good about the trajectory of the brand, and as I mentioned in Eric's question, kind of like the three core pillars that underlie it.

Operator

Thank you very much. Our next question is from the line of Megan Alexander with Morgan Stanley. Please proceed with your questions.

Megan Alexander

Analyst at Morgan Stanley

Hi. Thanks very much and thanks for all the detail. It's really helpful. I was wondering, Gina, if maybe we could unpack the revenue guidance for consumer products just a bit more. You cited that four points from exiting the licensing. Maybe you can help us understand what's implied from an industry POS expectation. And I guess is the comment that retail inventory is not a headwind or a tailwind. Should we assume that you're just kind of shipping in line with POS?

Gina Goetter

Chief Financial Officer at Hasbro

Yeah, good question, Megan. And that's where I was going to lead you, especially given where our inventory positions are sitting. Our assumption that we're making is that our shipment is going to more closely align with POS. In fact, we actually started to see that happen towards the tail end of this year. So, as you think about the guide, that gives you an indication of how we're thinking about just the broader macro environment. So, if you take those, call it roughly four points out for just the business exit, you're left with a down three to eight. In the down three scenario, that would be us over delivering and gaining share and beating the market. Down eight is probably more similar of us moving in line with the market.

But I think you've got the equation right. Our shipments are going to more closely kind of align with POS.

Megan Alexander

Analyst at Morgan Stanley

Okay. And then could you maybe quantify the net cost savings that are embedded in the guide? I think per your slides, you're going to get to kind of $500 million of gross cost savings by the end of this year. You've kind of said you haven't really seen any last year, so on that -- call it net 250 if you reinvest 50%. What's embedded this year, and I know you talked about some cost inflation, is that freight? Are you still seeing product inflation? Whether it's things like resin, can you just maybe quantify what is actually embedded in the guide?

Gina Goetter

Chief Financial Officer at Hasbro

Sure. Absolutely. Let's start on the inflation side first, and then we'll work our way back. So embedded in the guide is roughly an inflation rate of 3%. The single biggest inflation driver for us this year will be labor, labor within manufacturing and labor within the broader logistics network. We're also seeing some inflation within residents, to your point. I mean, that's our single biggest kind of component that we're purchasing. We are seeing that inflate and then fuel. So, I think between those three pieces you're roughly getting 2% to 3%. We believe we have cost productivity that more than offsets all of that. So specifically, within kind of our cost of goods, we will be a net margin contributor because of how that will play out.

In terms of the total gross saves, cost saves, I think it's fair to say that roughly -- call it $200 million, $250 million will be net cost savings between this supply chain, cost, productivity, offsetting inflation, as well as all of the moves that we're making below the line within managed expenses, whether it be people cost coming down or just broader purchase expenses coming down.

Megan Alexander

Analyst at Morgan Stanley

Great. And just to clarify that $200 million to $250 million, that's a net tailwind, versus '23, and that kind of should be independent of whether the top line is kind of above or below or at the high end or the low end of your guide.

Gina Goetter

Chief Financial Officer at Hasbro

That's right. Yes. That's right.

Operator

Our next question is from the line of Andrew Uerkwitz with Jefferies. Please proceed with your questions.

Andrew Uerkwitz

Analyst at Jefferies Financial Group

Hey, thanks for taking my question. I guess, I want to stick with Wizard of the Coast. If I think beyond 2024, what kind of cadence would we have in digital games? We saw two big games last year, no new ones this year, as far as we know. What kind of cadence should we expect there on the digital game side? And any clue on the mix between mobile and traditional PC console?

Chris Cocks

Chief Executive Officer at Hasbro

Hey, Andrew. Yeah, I would say for starting in '26, we'll probably have one major new digital game that we'll publish, and then '27 to '30, it'll be anywhere between one to two, depending on how the schedules kind of shake out. From a licensing perspective, I think you should generally see our licensing business after taking maybe a little bit of a step back this year, just given the Baldur's Gate III launch bulge, take a little bit of step back this year, but then it will grow sequentially every year as we just expand the number of licensers and games like Monopoly Go continue to mature and become more profitable for us. We're constantly adding new licensers to the mix. So, it's a little difficult to give you a lot of precise guidance about kind of like the mix between mobile or kind of like some of the casino gambling that we also license to, or PC and console. But generally speaking, our license mix tends to be more mobile and casino gambling than it would be PC and console, because that's where we're going to tend to focus our publishing efforts.

Andrew Uerkwitz

Analyst at Jefferies Financial Group

Got it. That's very helpful. And then on the Universes Beyond sets, coming beyond 2024, is the goal there with Marvel and Final Fantasy, to find new audiences, to kind of better monetize your current audience or even maybe flipping it around a bit. You're great in competitive. I think you're very good in kind of social gaming. But that collector spot of kids just buying cars for fun. Where are you trying to really target with some of these Universe Beyond sets with Final Fantasy and Marvel?

Chris Cocks

Chief Executive Officer at Hasbro

Well, I think it's, generally speaking, all the above. However, I think the special emphasis for Universes Beyond is new player growth. The Lord of the Rings was by far and away the most successful product at bringing in new players into the franchise that we've ever released. We would anticipate that would be the same or potentially even greater for IPs like Lord of the Rings or Marvel or some of the future things that we have in store. So, you know, it's a great way for us to kind of expand the base of users and grow kind of like future sets over time.

Andrew Uerkwitz

Analyst at Jefferies Financial Group

Got it. Thank you. Very helpful.

Operator

Our next questions are from the line of Jaime Katz with Morningstar. Please proceed with your question.

Jaime Katz

Analyst at Morningstar

Thanks. I'd be interested to hear how you guys feel you have completed the brand's pruning process. Is that largely done? Is it still underway? I'm just trying to think about what other headwinds we might have in the future.

Chris Cocks

Chief Executive Officer at Hasbro

I would say, good morning, Jaime. I would say it's largely done. There might be one or two more, and we would announce those deals within the next month or two. And then I would say moving forward, you should think about us as net brand creators.

Gina Goetter

Chief Financial Officer at Hasbro

Yeah, my only add to it on the cleanup, I would say kind of the same sentiment holds like, we're done with the cleanup. So, as we head into '24, we're rebuilding. We're building now.

Jaime Katz

Analyst at Morningstar

Okay. And then, Gina, I don't think it's been delineated. What portion of the cost savings are coming out of cost of goods sold relative to SG&A. My suspicion is most of it's out of that SG&A line. But do you have that bifurcated and an easy way to digest. Thanks.

Gina Goetter

Chief Financial Officer at Hasbro

Yeah. My very simple would say, yes, you're right. It's about half and half. If I look at the big buckets, there's a little bit that we did in '23 on royalty expense, but it's really small change compared to the cost savings we're driving within supply chain and within the managed or operating expenses. So, it's almost half and half.

Operator

Our next question is from the line of Jason Haas with Bank of America. Please proceed with your questions.

Jason Haas

Analyst at Bank of America Merrill Lynch

Hey, good morning. Thanks for taking my questions. I'm curious if you could say what POS was for you guys in 4Q, and then I'm also curious, it sounds like you're expecting the industry could be down as much as 8% in 2024, but then expect it gets back to, I think you said, low single digit growth thereafter. So, I'm just curious to hear your thoughts on why you think the industry will be down so much and then what needs to change to get it back to growth?

Chris Cocks

Chief Executive Officer at Hasbro

Yeah. Hey, good morning, Jason. In Q4, we were down around 12% or 13% on our internal point of sale measurements. When you factor out some of the exited licenses that we didn't comp, it was more down around negative 9% in the quarter, which roughly tracked around what the industry did. We think the industry did between negative nine and negative ten. For the full fiscal year, we were down negative ten to negative eleven. Based on our internal point of sale tracking and ex those kind of exited brands, we were down about negative 6%, which again, roughly tracks with kind of what our feeling is for the industry.

In terms of our call for industry trends moving forward, I think, generally speaking, we think the prevailing trends that existed in the back half of 2023 are likely going to persist into at least the first half of 2024 and probably into the second half of 2024. We still have a little bit of a correction from pre-COVID kind of toy share of wallet that we think we're experiencing in markets like the U.S. We do see growth in places like Latin America and Southeast Asia, and we generally are kind of thinking that once we get through 2024, we're largely past that kind of post COVID correction, and we start getting back into a toy market, which, from our planning purposes, we're basically projecting to be around flat. And that based on our innovation and the marketing that we're putting together and just the general kind of fundamental health of the business that we're reinjecting into it, that we can grow at that level, or likely ahead of that level, and build some share, particularly in the categories we're focused on.

Jason Haas

Analyst at Bank of America Merrill Lynch

Got it. That's really helpful. And then a follow up. I was curious if you could help size up how much Baldur's Gate III and Monopoly Go contributed in 4Q? I know you gave some color on it for 2024, but just curious, any more color on what those could contribute as we go through 2024 would be helpful.

Gina Goetter

Chief Financial Officer at Hasbro

As we move through '24, yeah. For Monopoly Go in Q4, it was just the minimum guarantee that we booked in from a revenue standpoint. And Baldur's Gate had another healthy, healthy quarter. I think for the year, in totality, Baldur's Gate was around $90 million of revenue. So now, as you turn the corner into 2024, the front half of the year, you're still going to have the tail from Baldur's Gate III. That's going to stay with us all year. Obviously not at the same extent that we saw play through in Q3 and Q4, but we'll still be selling units and making revenue and profit off of that product.

For Monopoly Go, what gets interesting is that based on our forecast, based on how well the game is doing, as we get into the back half of the year, we believe we'll be able to start booking revenue and profit ahead of our minimum guarantee. Now, we don't get into the terms of the contracts and what that royalty rate is, but suffice it to say as we think about the comp that we're up against, Monopoly Go -- in the back half, Monopoly Go is going to almost get there. Not quite get there, but almost get there and kind of offset the headwind that we have from Baldur's Gate.

Jason Haas

Analyst at Bank of America Merrill Lynch

Got it. That's helpful. Just a quick clarification. I think you said earlier that you're expecting, I think you said digital game licenses. I think it was, it's going to be flat year over year. So, is that right that the full amount of Monopoly Go and Baldur's Gate III in 2024 should roughly be equivalent to what we saw in 2023?

Gina Goetter

Chief Financial Officer at Hasbro

Yes, I think you're saying that right.

Jason Haas

Analyst at Bank of America Merrill Lynch

Okay, great.

Operator

Our next questions come from the line of Linda Bolton Weiser with D.A. Davidson. Please proceed with your questions.

Linda Bolton Weiser

Analyst at D.A. Davidson

Yes. Hi. So, I guess I took from your comment that you said that cash balance would be down in the end of 2024 versus 2023. So, I take that to mean that operating cash flow minus capex minus dividends will be negative. Am I reading that correctly? And do you have a guidance number or range for operating cash flow like you usually give for 2024?

Gina Goetter

Chief Financial Officer at Hasbro

I mean, we haven't officially made a guidance, but it's going to be -- operating cash flow is going to be slightly down versus where we landed the year strictly because of the inventory benefit that we got. We captured that early. We captured that as part of our '23 cash flow. In terms of ending cash, it's slightly down. I mean, you could almost argue that ending cash is going to be relatively flat year over year, but it's slightly down. And it's slightly down because we're stepping up our capital expense a little bit. And then we also have additional charges related to the announcements that we had in December that play in. But no, we don't get to negative free cash.

Linda Bolton Weiser

Analyst at D.A. Davidson

So, can you help me understand the change in cash, taxes paid and also the change in outflow related to cash restructuring in 2024 versus 2023?

Gina Goetter

Chief Financial Officer at Hasbro

I'm going to have to follow up with you on the cash tax. In terms of the cost for restructuring, we paid roughly, I would say -- call it $70-ish million, as we move through '23, and as we move into 2024, that's going to be roughly -- call it $100 million.

Linda Bolton Weiser

Analyst at D.A. Davidson

Okay. That would be for cash restructuring, things like severance and other cash costs, correct?

Gina Goetter

Chief Financial Officer at Hasbro

That's right.

Linda Bolton Weiser

Analyst at D.A. Davidson

Okay. And then I know that you really want to protect and continue to pay the dividend, but one might argue that Mattel's turnaround really started when they cut the dividend because it gave them a little bit of flexibility to work down the debt. You really didn't state any leverage targets for 2024 or 2025. Your stock is trading as if the dividend is not safe. So, one might argue that it would really benefit shareholders to at least reduce the dividend so that you could work down the debt a little bit faster. Can you just respond to that idea?

Gina Goetter

Chief Financial Officer at Hasbro

I'm going to go back to our prepared comments, and both Chris and I remain, and our board remain supportive of our capital allocation strategies, which includes the dividend. And we believe the actions that we've taken both in '23 and '24 to free up cash support those capital allocation priorities. I hear your point on the de-lev and getting to those targets faster. We're still committed to getting to those de-lev targets. We think, though, that fixing the business also is going to free up our ability to hit all of our cap allocation priorities.

Linda Bolton Weiser

Analyst at D.A. Davidson

And then just my next question is just more operational. I guess one of the things that kind of went wrong, I guess you could say in 2023, is that the industry POS slowed a lot in the second half, or it wasn't what you would have thought, and that was the same for Mattel. So, is there anything about 2024 that if the industry actually gets worse versus what you're projecting, is there any flexibility or levers that you can use to better reach your financial goals in 2024, even if the industry ends up being different than you thought?

Chris Cocks

Chief Executive Officer at Hasbro

Well, I would say our projection for the industry is probably on the more cautious side than what most independent analysts or other toy companies would have. So, I think we're going in with a cautious outlook. I also think we have a lot of tools in our quiver in terms of cash liquidity. We've got $1.8 billion of cash liquidity and options, should we have to get whether a down quarter or two that is worse than what we're predicting. And our new management team, I think, is showing quite an adeptness at cost management and supply chain management. So, there are levers that we have to pull. We feel quite confident in our ability to execute against our capital allocation priorities, which are investing in the business for long-term growth, continuing to give money back to shareholders via our dividend, and in achieving our long-term deleveraged targets, which is 2.5 or less.

Linda Bolton Weiser

Analyst at D.A. Davidson

Okay, thank you. Good luck with everything.

Operator

Our final question is from the line of Stephen Laszczyk with Goldman Sachs. Please proceed with your questions.

Stephen Laszczyk

Analyst at The Goldman Sachs Group

Hey, great. Good morning. One on longer term margins and one on capex. Maybe first for Gina on margins, just given the new cost efficiency targets, could you update us on your view for what you think the medium to long term margin opportunity in consumer products is? And maybe the path to get there beyond the four to six you guided in 2024. And then just on capex, you called out the $225 million in capex for this year. Could you just unpack a little bit more in terms of what that's being invested into and maybe what you think the long- term outlook for capex is on an annualized basis beyond some of the initial programs. Thank you.

Gina Goetter

Chief Financial Officer at Hasbro

Got it. Okay, good question, Stephen. So, on margins overall for the company, we remain committed to getting to that 20% midterm target that I think we put out there at our last Investor Day. As you break down the CP number, we have a lot of momentum on the margin side as we head into this year. I believe as we turn into '25 and '26, we're continuing to refine what's happening within our supply chain, what's happening within our cost structure. So that will provide some uplift on the margin.

But the single biggest thing that's going to help us keep moving to the tens, to the teens and beyond on toy, is really volume, in getting back to growth, putting innovation in market, that is actually growing our business. That leverage benefit will have the kind of the single biggest impact on that margin line. So, I think we have a good line of sight to the margin targets that we put out there for this year. For next, we are anticipating that our margin is going to grow again. The speed with which we move up that scale will really be dependent on how fast we can get over the growth hump.

In terms of capex, that step up that step-up we're seeing this year really is being driven by our investment in digital games. If you think about that breakdown of $225 million, there is, roughly half of it goes into our Wizards business. Another, I would say half of that half, then, is going back into our toy business with the remaining piece that's going into our broad infrastructure. So, we're continuing to build capabilities both within just kind of the underpinning of the organization, when you think about IT and systems, as well as within our broader supply chain.

Chris Cocks

Chief Executive Officer at Hasbro

Yeah. And just for strategic context, Stephen, and thanks, by the way, for being the anchorman on the questions for us. You know, our investments in digital and digital gaming, they're foundational to the future of the company. It's something we've been investing in for the last seven years. It's something that I think you should anticipate that we will at least maintain, if not grow, over the next three to five years. And it's going to be a material source of value creation, particularly in the game side of our business moving forward. I think we already see that it can work, and work fantastically well with what we've been doing with licensing partners, particularly with Monopoly Go and Baldur's Gate III last year, and great acquisitions like we made with D&D beyond. And I think you're going to see more and more value creation as we go through '24, '25 and into '26.

Stephen Laszczyk

Analyst at The Goldman Sachs Group

Great. Thank you both.

Operator

Thank you. This will conclude the question answer session and also concludes today's conference. [Operator Closing Remarks]