Thanks to weakness in the New Jersey-based company’s baby business as well as heavy competition, Global retailer Toys ‘R’ Us saw its consolidated net sales plummet by US$113 million to US$2.2 billion in the first quarter of this year.
Operating losses for the period ending April 29 were US$54 million, an increase of US$47 million compared to the same in Q1 2016. Domestic net sales for TRU’s Baby category were down 2 per cent over that of last year, while the Core Toy category grew by 1.4 per cent.
Gross margin dollars accounted to US$783 million,down US$63 million a year ago. Consolidated same-store sales decreased by 4.1 per cent driven by a 6.2 per cent decline in the company’s domestic business.
International sales fell by 0.6 per cent resulting from weaker sales in Europe, though these results were partially offset by growth in Asia Pacific.
In fact, Toys ‘R’ Us recently announced a strengthened focus on Asia-Pacific operations, unifying its Japanese business with its ventures in Greater China and Southeast Asia.
The results come after Toys ‘R’ Us saw its net sales dip 2.2 per cent to US$11.5 billion in fiscal 2016. While the retailer saw a strong start to the 2016 holiday season, it faced sluggish sales in the weeks following Black Friday.
In the coming days, the retailer believes several key initiatives including an enhanced loyalty programme and new capabilities in CRM will drive growth during the second half of the year.
