Toys ‘R’ Us ends Q1 with $1 billion liquidity, $458 million cash

By Lisa Kerner

Charlotte, N.C., June 21 – Toys “R” Us, Inc. ended its first quarter on April 30 with total liquidity of $1 billion.

Liquidity included cash and cash equivalents of $458 million and availability under committed lines of credit of $582 million, according to the earnings news release.

Toys “R” Us Delaware, Inc. ended the quarter with $571 million of liquidity, including cash and cash equivalents of $179 million and availability under its revolving line of credit of $392 million.

Debt refinancing

Previously, Toys “R” Us announced it entered into an agreement to refinance a portion of its outstanding debt.

Noteholders of about 50% of the company’s $850 million of debt scheduled to mature in 2017 and 2018 agreed to an exchange offer to extend debt maturities.

Toys “R” Us said it plans to refinance up to about 89% of the existing notes via the exchange offer, which involves the trading of existing debt for newly issued debt maturing in five years.

Also, a third party agreed to purchase up to $50 million of new debt, subject to the successful completion of the exchange offer.

Financial highlights

First-quarter capital spending was $50 million, compared to $43 million in the prior-year period.

Consolidated net sales were down $6 million year over year at $2.32 billion. The decrease was mainly attributable to domestic store closures, which included the company’s Times Square and FAO Schwarz flagship stores.

Toys “R” Us had an operating loss of $7 million, compared to $30 million a year ago.

First-quarter adjusted EBITDA improved by $9 million, year over year, to $79 million.

The Wayne, N.J.-based toy retailer had a net loss for the quarter of $126 million, an improvement of $14 million.

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