Toys ‘R’ Us Sales Declined Ahead of September Bankruptcy FilingBy
Toys “R” Us Inc. reported “disappointing” results for the three months ending October 28, during which the toy retailer was forced to file bankruptcy after vendors cut shipments.
Same-store sales in the U.S. declined 7 percent compared with a year earlier, according to a statement Tuesday from the Wayne, New Jersey-based company. Net sales fell to about $2 billion, down $89 million from last year, and the operating loss widened to $208 million from $40 million.
The results “demonstrate the continued challenges we face in both the baby and learning categories,” Chief Executive Officer Dave Brandon said in the earnings statement. “We recognize the need for change in order to better meet customers’ ever evolving shopping preferences.”
Toys “R” Us, which filed for bankruptcy in September, is considering closing at least 100 U.S. stores due to weak holiday sales, according to people with knowledge of the situation. Poor results threaten to complicate the retailer’s plans to get its finances in order and emerge with an improved balance sheet. Before filing for bankruptcy, the company had been weighed down by roughly $5 billion in debt, stemming from a leveraged buyout last decade led by Bain Capital.