By Lisa Johnston
New products on display at the American International Toy Fair, held in N
Rex Stores, which plans to leave the retail business by the end of its 2009 fiscal year, reported lower net sales and a loss in its retail operation for the quarter, ended April 30.
Retail sales are down more than $10 million, to $15.6 million, in its second fiscal quarter, compared with the same period last year. Rex reported a loss of $453,000 for the quarter, compared with a net profit of $713,000 in the prior year.
As previously reported, Rex has leased 37 owned retail locations to Appliance Direct, the Florida-based majaps chain, which also entered into a lease and sublease for two store locations leased by Rex.
Rex confirmed that it still plans to fully exit its retail operations during the 2009 fiscal year. Going forward, it expects to recognize deferred income from service contracts and prior real estate sales, which should largely offset costs incurred in exiting this segment, the company said.
In a conference call last Tuesday, Stuart Rose, chairman/CEO of Rex, said the company has exited most of its retail stores but did not specify the number of locations.
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