Afternoon Coffee: Toys R Us Demise Still Affects Mattel, Hasbro; Sears Lives to Avoid Liquidation

Last fall’s liquidation of Toys R Us continued to be a disruption through the holiday season, as lower sales numbers from toy makers Mattel and Hasbro show, The Wall Street Journal reports.

Mattel reported that its fourth-quarter sales were down 5%, and Hasbro’s quarterly sales fell 13%, the Journal reports.

The liquidation of all those Toys R Us stores across the country and online flooded the market with inventory, the Journal reports.

Hasbro Chief Executive Brian Goldner told the Journal on Friday the liquidated inventory was “more impactful” than the company and analysts had projected. “It is an unprecedented yet finite event,” Mr. Goldner said.

Toys R Us sought bankruptcy protection in September, and national retail figures show its impact.

“The U.S. toy industry sales fell 2% overall in 2018 to $21.6 billion, according to the research firm NPD Group Inc., with a slump toward the end of the year after Toys R Us stores closed. It was a sharp turnaround from the first half, when NPD said sales rose 7%,” the Journal reports.

Sears, Kmart Get Another Chance

The troubled Sears department store chain was thrown a lifeline Thursday afternoon when a bankruptcy judge approved a plan to keep hundreds of stores open and thousands of people employed, the Chicago Tribune reports.

The Illinois-based company filed for bankruptcy in the fall, and its chairman and former CEO, Eddie Lampert, won a court battle with his bid of $5.2 billion. A rival group of creditors had wanted the judge to approve a plan to liquidate the company.

“Lampert’s purchase, made through his hedge fund, ESL Investments, is intended to keep 425 Sears and Kmart stores open, preserving some 45,000 jobs,” the Tribune reports.

On Bezos News, Amazon Shares Down

Personal news about Amazon founder Jeff Bezos, including his divorce and his belief that the National Enquirer’s parent company tried to blackmail him, has shaken the company’s stock performance, but analysts say not to worry.

Also, Amazon is reconsidering its plan to locate a campus in New York because of local opposition, the Washington Post reports.

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