Business

It’s a bit of a bear market for the bear market

Sales decline at Build-A-Bear

“The shortfall in our year’s results are largely attributed to the persistent and significant revenue and profitability challenges in the UK,” said Build-A-Bear chief executive Sharon Price John.

Mon Jan 14 2019 - 15:44

Fears of a bear market in Britain came out of hibernation for Build-A-Bear Workshop, the American toy company, which on Monday lowered expectations for its fiscal-year revenue.

The company cited Brexit and EU general data protection laws among the grizzly factors facing European retailers and driving the slide in European revenue. The sales decline, the stuffed bear company said, will be “largely isolated in the UK”.

North American full-year revenue will barely be down, with the company expecting a decline of about 2 per cent compared with the previous fiscal year. However, non-US sales - it has stores in the UK, Ireland, Denmark and one in China - are expected to fall by up to 20 per cent compared with a year ago.

Results

“The shortfall in our year’s results are largely attributed to the persistent and significant revenue and profitability challenges in the UK,” said chief executive Sharon Price John.

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The company also had to bear “significantly fewer” family, character-based films and the liquidation of one of the largest global toy retailers. Its sales trend meanwhile, Ms Price John said, has been “positive”.

Unresolved issues related to Brexit damped consumer confidence and currency exchange rates, the bearmaker’s chief said, while European privacy laws “impeded” the company’s marketing communications.

Build-A-Bear’s interactive retail stores, which allow children a hand in designing and building their own teddy bears and plush toys, said that declining numbers of shoppers in shopping centres had “significant” bearing on their sales figures.

Expectations

As the company finds its bearings, it has reduced its sales expectations for the year ending February 2 to between $335 million (€292 million ) and $340 million, down from a prior forecast of $340 million to $345 million. The company said it generated total revenue of $364 million for a recast 53-week period that ended on February 3rd, 2018.

The company’s shares were down marginally at the start of US trading.

The company said it has sold more than 180 million “furry friends” since it was founded in 1997. Bear with them. – Copyright The Financial Times Limited 2019

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