Toy retailer reports ‘disappointing’ year

Toys “R” Us reported declines in same-store sales for its fourth quarter and full year amid a highly competitive environment.



"Despite a strong start to the holidays, in the weeks following Black Friday we faced a combination of sluggish sales and intense promotional activity," said Dave Brandon, chairman and CEO, Toys "R" Us. "The widely recognized tough retail environment this holiday and continued weakness in the entertainment and baby categories contributed to the erosion of our top-line and an overall disappointing year.”



The chain reported net earnings of $341 million for the quarter, ended Jan. 28, compared to $276 million in the prior year period.



Net sales totaled $4.66 billion, down from $4.85 billion in the year-ago period. Same-store sales fell 3%, with a 2.3% decrease in the United States primarily due to declines in the entertainment (which includes electronics, video game hardware and software) and baby categories. International same-store sales decreased 4.2%, with notable weakness in Europe for the quarter.



For the full year, Toys “R” Us reported a net loss of $36 million, compared to a net loss of $130 million in the year-ago period.



Consolidated net sales totaled $11.54 billion, down $262 million from fiscal 2015. Total same-store sales fell 1.4%. International decreased by 1.6%, driven by declines in the Europe and Asia Pacific markets, partially offset by growth in Canada.



Looking ahead, the retailer said it remained focused on improving in every area of its business.



“We have a number of important initiatives planned this year, including the launch of our new webstore and the expansion of our joint venture with Fung Retailing in Asia, and some exciting plans with several of our vendor partners to bring innovation and excitement to our customers,” Brandon said.