September 20, 2006, 12:00 AM

ToysRUs.com sales decline 16.1% in Q2

Second quarter web sales for ToysRUs.com decreased by $10 million, or 16.1%, to $52 million from $62 million in the second quarter of 2005. Total sales rose by 15% to $2.41 billion from $2.09 billion in Q2 2005.

Mark Brohan

Research Director

Second quarter web sales for ToysRUs.com decreased by $10 million, or 16.1%, to $52 million from $62 million in the second quarter of 2005. Total sales rose by 15% to $2.41 billion from $2.09 billion in Q2 2005.

Toys “R” Us Inc. says the decrease in net sales can be attributed to a 17% decline in domestic orders and a 3% decline in average order dollar value during the transition to a new web site in the Unites States. Net sales of baby products decreased by 17.2%, toys categories decreased by 12.5% and video games categories decreased by 43.6% compared to the same period last year, according to Toys “R” Us

But net sales for ToysRUs.com increased by $3 million, or 2.4%, to $129 million for the twenty-six weeks ended July 29, 2006, from $126 million for the same period last year.

The net sales increase for January through June was due to a 4% increase in average order dollar value, which was partially offset by a 3% decrease in total orders. Net sales of baby products increased by 8.5%, while toy and video game sales decreased by 4.2% and 25.7%, respectively.

Toys "R" Us is also opening a 574,000 square foot fulfillment center in Groveport, OH, to support the company`s expanding product assortment on Toysrus.com and meet increased demand during the upcoming holiday season. The company signed a multi-year lease with Duke Realty Corp. for the site, which is designed to handle the volume of the peak toy-selling season.

Toys "R" Us, No. 31 in the Internet Retailer Top 500 Guide to Retail Web Sites , re-launched its e-commerce sites after canceling its multi-year e-commerce platform and merchandising agreement with Amazon.com Inc. in March. Under new long-term agreements, GSI Commerce Inc. provides ToysRUs.com with technology, customer service and support and Exel provides fulfillment services for both ToysRUs.com and BabiesRUs.com.

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