Embattled Toys R Us posts modest sales lift amid recapitalisation plans
Toys R Us, once one of the nation’s biggest children’s toy and clothing stores, has posted a modest lift in quarterly sales amid plans to recapitalise the business.
The retailer — which has become an online-only business after it collapsed in 2018 — reported revenues of $863,000 in the three months to the end of April, slightly up from the $779,000 recorded a year earlier.
In its newly filed accounts to the Australian Securities Exchange, Toys R Us said its primary debt holder was supporting short-term cash requirements and working with the board whilst a recapitalisation plan was finalised.
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By continuing you agree to our Terms and Privacy Policy.Toys R Us said if agreed, the recapitalisation plan would provide it with sufficient capital to fund ongoing operations and enable the business to deliver financially sustainable operations.
“The board and management team have worked tirelessly over the quarter, focused on driving operational efficiencies and implementing robust marketing strategies,” Toys R Us executive chair Kelly Humphreys said.
“This work is now achieving better outcomes for the business and demonstrating the capability to deliver profitable operations when fully funded.
“The board is working to finalise a recapitalisation of the business and remains committed to delivering long term success for your company.”
Toys R Us filed for bankruptcy in 2018, closing 44 Australia stores and leaving around 700 people without jobs.
Toys R Us re-launched online in late 2019 after reaching a deal with Hobby Warehouse. In 2021, it was bought by ASX-listed retailer Funtastic, which changed its name to Toys R Us the same year.
But it has been a challenging re-launch for the toy store chain as it faces stiff competition from bigger rivals like Kmart, Amazon, Shein and Temu.
It comes just months after Toys R Us’ auditor warned the retailer could soon run out of money due to a near $13 million gap between what it owed and the total value of assets.
Toys R Us said a key strategic objective was to grow existing and introduce new online shopping channels, an initiative that was now generating stronger sales and contributing to higher rates of customers returning.
