aNb Media News, September 6, 2017

TRU Hires Kirkland & Ellis to Restructure Debt

Toys “R” Us (TRU) has retained the law firm Kirkland & Ellis to help restructure its debt of roughly $400 million due in 2018, according to a recent CNBC report. Kirkland & Ellis partners have previously worked with the company regarding acquisitions of its assets.

The news follows a $38 million net loss in Q1 2017, which was announced in June 2017 during an earnings call. Consolidated same store sales decreased by 4.1 percent, driven by a 6.2 percent decline in its domestic business and weakness in the baby category for the first quarter. TRU’s second quarter earnings call is scheduled for Tuesday, September 26.

TRU has previously worked with Bank of America, Goldman Sachs, and Lazard to refinance its debt. The company refinanced all of its 2017 debt and a significant portion of its 2018 maturities with the completion of the TRU Taj notes exchange in August 2016 and the Propco II CMBS and mezzanine financings in November 2016.

LEGO Announces Five Percent Decline in Sales, Plans to Cut 1,400 Jobs

The LEGO Group reported fiscal results for the first half ending June 30, 2017. Revenue for the period totaled DKK 14.9 billion, a decline of five percent compared with the first half of 2016. Performance across the market regions was mixed. In established markets such as the U.S. and in parts of Europe revenue declined, while in a growing market, such as China, revenue grew by double digit.

Operating profit was DKK 4.4 billion, down six percent compared with the same period in 2016. This was due to lower revenue and increased costs associated with investments in production capacity and organizational capabilities made to support higher expectations of revenue which failed to materialize.

“We are disappointed by the decline in revenue in our established markets, and we have taken steps to address this,” says LEGO Group Chairman Jørgen Vig Knudstorp. “We are working closely with our partners and we are confident that we have the long-term potential of reaching more children in our well-established markets in Europe and the United States. We also see strong growth opportunities in growing markets such as China.”

During the past five years, the LEGO Group has built an increasingly complex organization to support global growth. “In the process, we have added complexity into the organization, which now in turn makes it harder for us to grow further,” says Knudstorp. “As a result, we have now pressed the reset-button for the entire Group. This means we will build a smaller and less complex organization than we have today, which will simplify our business model in order to reach more children. It will also impact our costs. Finally, in some markets the reset entails addressing a clean-up of inventories across the entire value chain. The work is well under way.”

As a consequence of the plans, the LEGO Group will reduce its total global workforce by about eight percent, or approximately 1,400 positions, the majority before the end of 2017. Currently the LEGO Group employs approximately 18,200 people.

The LEGO Group would provide the affected colleagues with redundancy packages which reflect their service to the organization, including support in transitioning to new positions or new opportunities outside of the Group. Any changes would be implemented in accordance with local market regulation and in consultation with relevant employee representative bodies.

Pressing the reset button is one of two elements of a plan launched by the Group. The second element is how to return to growth. The Group is doing this by exploring adjustments to its formula for product development and marketing in order to achieve its ambition to reach more children around the world with LEGO play experiences that stimulate playful learning.

Spin Master Announces the Second Annual Hatchimals Day

Spin Master announced the next innovation in the Hatchimals franchise, Hatchimals Surprise, will be revealed on Hatchimals Day, Friday October 6.

Hailing from Hatchtopia, Hatchimals Surprise are different from previous Hatchimals with new eggs, a new hatching process, new species, and a new surprise on Hatchimals Day.

“We’ve seen a tremendous response to the Hatchimals brand globally, and we continue to see success with the recent introduction of Hatchimals Colleggtibles,” says Ben Gadbois, Spin Master’s global president and COO. “As we continue to deliver on our innovation pipeline, we are proud to announce our second annual Hatchimals Day on October 6 when we will introduce a whole new way of hatching for children across the globe.”

Pre-order will be available beginning September 18 across all major retailers. Visit for updates.