Consolidated same store sales grew by 2.3% for the quarter and 0.9% for the full year; Fiscal 2015 SG&A expense reduction of $322 million resulted in the lowest full year SG&A since 2006; Full year consolidated Adjusted EBITDA1 of $800 million, a 25% improvement over the prior year; Consolidated Net Leverage2 for fiscal 2015 of 5.0x, a reduction of 1.3x
March 10, 2016 // Franchising.com // WAYNE, NJ - Toys"R"Us, Inc. today reported financial results for the fourth quarter and full year of fiscal 2015 ended January 30, 2016. Consolidated Adjusted EBITDA was $800 million for the full year, a $158 million improvement. The Domestic segment showed continued improvement in operating performance for the fourth quarter and full year and International segment same store sales grew for the eighth consecutive quarter. Since the inception of the “Fit for Growth” initiative in 2014, the Company has realized $307 million in savings, with the balance of the $325 million target expected to be achieved by the end of fiscal 2016.
“I am very encouraged by our positive consolidated same store sales in what was a very competitive marketplace,” said Dave Brandon, Chairman and Chief Executive Officer, Toys"R"Us, Inc. “Throughout the year, and especially during the holiday season, we focused on improving our execution to deliver a positive and memorable shopping experience to our customers. We significantly improved our performance, but we can and will make further progress on our quest to achieve flawless execution in every aspect of our operations. We grew Adjusted EBITDA by 25% by successfully executing a number of key initiatives while continuing to take advantage of the progress we’ve made to right-size our cost structure.”
In closing Mr. Brandon stated, “We have an exciting and challenging year ahead of us. We believe we can continue the positive momentum we have built by executing our four strategic pillars: grow and build our brands throughout the world, create a world class experience for our customers, create a strong financial foundation and make talent and culture a competitive advantage. I am proud of the hard work that all of our team members have put in to get us to this point and I look forward to continuing on our path forward.”
The Company, including Toys"R"Us-Delaware, Inc., ended the year with total liquidity of $1.8 billion, which was relatively consistent with last year. This was comprised of cash and cash equivalents of $680 million and availability under committed lines of credit of $1.1 billion. Toys"R"Us-Delaware, Inc. ended the year with $1,023 million of liquidity, a $54 million improvement from last year. This was comprised of cash and cash equivalents of $139 million and availability under its revolving line of credit of $884 million.
Total debt was $4.7 billion, a decrease of $45 million from the prior year.
A summary of the “Fit for Growth” initiative is set forth at the end of this press release.
1A detailed description and reconciliation of EBITDA and Adjusted EBITDA for Toys"R"Us, Inc. and Toys"R"Us-Delaware, Inc., and management’s reasons for using these measures, are set forth at the end of this press release.
2Net Leverage represents total debt outstanding less cash and cash equivalents and restricted cash attributed to debt as of the end of the year, divided by full year Adjusted EBITDA.
Toys"R"Us, Inc. is the world’s leading dedicated toy and baby products retailer, offering a differentiated shopping experience through its family of brands. Merchandise is sold in 866 Toys"R"Us and Babies"R"Us stores in the United States, Puerto Rico and Guam, and in more than 750 international stores and over 245 licensed stores in 37 foreign countries and jurisdictions. In addition, it exclusively operates the legendary FAO Schwarz brand and sells extraordinary toys at FAO.com. With its strong portfolio of e-commerce sites including Toysrus.com and Babiesrus.com, it provides shoppers with a broad online selection of distinctive toy and baby products. Headquartered in Wayne, NJ, Toys"R"Us, Inc. has an annual workforce of approximately 62,000 employees worldwide. The Company is committed to serving its communities as a caring and reputable neighbor through programs dedicated to keeping kids safe and helping them in times of need. Additional information about Toys"R"Us, Inc. can be found on Toysrusinc.com.
All statements that are not historical facts in this press release, including statements about our beliefs or expectations, are forward-looking statements. These statements are subject to risks, uncertainties and other factors, including, among others, the seasonality of our business, competition in the retail industry, changes in our product distribution mix and distribution channels, general economic factors in the United States and other countries in which we conduct our business, consumer spending patterns, birth rates, our ability to implement our strategy including implementing initiatives for season, our ability to recognize cost savings, implementation and operation of our new e-commerce platform, marketing strategies, the availability of adequate financing, access to trade credit, changes in consumer preferences, changes in employment legislation, our dependence on key vendors for our merchandise, political and other developments associated with our international operations, costs of goods that we sell, labor costs, transportation costs, domestic and international events affecting the delivery of toys and other products to our stores, product safety issues including product recalls, the existence of adverse litigation, changes in laws that impact our business, our substantial level of indebtedness and related debt-service obligations, restrictions imposed by covenants in our debt agreements and other risks, uncertainties and factors set forth in our reports and documents filed with the Securities and Exchange Commission (which reports and documents should be read in conjunction with this press release). In addition, we typically earn a disproportionate part of our annual operating earnings in the fourth quarter as a result of seasonal buying patterns and these buying patterns are difficult to forecast with certainty. We believe that all forward-looking statements are based on reasonable assumptions when made; however, we caution that it is impossible to predict actual results or outcomes or the effects of risks, uncertainties or other factors on anticipated results or outcomes and that, accordingly, one should not place undue reliance on these statements. Forward-looking statements speak only as of the date they were made, and we undertake no obligation to update these statements in light of subsequent events or developments unless required by the Securities and Exchange Commission’s rules and regulations. Actual results and outcomes may differ materially from anticipated results or outcomes discussed in any forward-looking statement.
For Full Spreadsheet Report, please go to: [http://www.toysrusinc.com/press-room/releases/financial/2016/toysrus-inc.-reports-results-for-the-fourth-quarter-and-full-year-of/].
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