Tough quarter for Toys “R” Us
The nation's largest toy store retailer saw its sales decline and net loss widen in a rough first quarter.
For the quarter ended April 29, Toys "R" Us reported a net loss of $164 million. That's up from net loss of $126 million in the year-ago period.
Net sales were $2.2 billion, down $113 million from last year. Excluding for the impact of foreign currency exchange, net sales declined by $89 million. The retailer attributed the decline in sales largely to declines in the baby category.
Consolidated same store sales decreased by 4.1%. Same-store U.S. sales fell 6.2%. Same-store sales at international stores were down 0.6%.
"The challenges we faced during holiday 2016 continued in the marketplace during the first quarter," said Dave Brandon, chairman and CEO, Toys "R" Us. "Overall weakness in the baby business, as well as slower growth in the toy category and very aggressive price discounting by our competitors were significant contributors to our disappointing results."
Brandon added that the company has several initiatives that should boost sales in the second half of the year,
"Among the more noteworthy projects are our new webstore and baby registry, which will be implemented this summer; new capabilities in CRM; an enhanced loyalty program and additional shop-in-shops to drive traffic," he said. "We expect this work will have a meaningful difference on the customer experience in both our webstore and bricks and mortar locations."
The company ended the first quarter with total liquidity of $701 million, which was comprised of cash and cash equivalents of $301 million and availability under committed lines of credit of $400 million.
Toys "R" Us operates 879 Toys"R"Us and Babies"R"Us stores in the United States, Puerto Rico and Guam, and in 815 international stores and over 255 licensed stores in 37 countries and jurisdictions.
Just waiting for them to go bankrupt. At this rate they can not sustain much longer. They have quietly been closing stores the past several years