Toys R Us Profits Drop 75%

TRENTON, NJ/USA (15 August 2000) -- US retailer Toys R Us announced on Monday that second quarter profits plunged 75%. The company attributes the drop to sluggish sales and losses turned in by its on-line business. According to Toys R Us, which next to games, toys and clothing is one of America's largest sellers of children's bicycles, net earnings for the three months ending 29 July totaled US$3 million, down from US$12 million for the same period in 1999. In the second quarter sales dropped 9.5% to US$2 billion. The company said sales were hurt by the lack of hot toys like last year's rage Furby and Star Wars items. The numbers from outside the US were more positive, as sales rose 3% in the second quarter. To keep up with Wal-Mart, which took over Toys R Us as the nation's top toy retailer in 1998, Toys R Us has announced it will continue to remodel its stores and abandon its year-old Toysrus.com in favor of a joint website with giant internet retailer Amazon.com, a strategy meant to make Toys' online business profitable two years earlier. (JW)