Toys R Us on course for split
Losses narrow in third quarter
Toys R Us is on track to split its businesses in early 2005, and has notched up a narrower loss in the third quarter of the year.
The toy giant reported a loss of $25m for the three months to the end of October, with the coffers boosted by the closure and sale of its Kids R Us stores to Office Depot. The group expects to separate the underperforming Toys R Us chain, hit by severe competition in the core US market, from the more profitable Babies R Us business.
The international business, which includes the UK Toys R Us Stores, has been reported to be the target of a potential management buy out backed by venture capitalists.
Chairman and chief executive John Eyler said: “Our strategic review continues, and we will not comment further on this subject until our board of directors reaches a decision on the specific steps that will be taken to separate the ownership of Babies R Us and the global toy business. We continue to believe the separation will occur during the first half of 2005.”
Across the quarter, the US toy store division saw same sales decrease by 1.7 per cent , with a 5 per cent fall across the nine months to October 30. By contrast, international same store sales grew by 4.3 per cent during the quarter and by 1.1 per cent across the nine months.
