This isn’t the kind of billion-dollar year Toys ‘R’ Us was hoping for.
The giant toy retailer said Wednesday it lost more than $1 billion last year and its sales fell by a similar sum, as the chain was pummeled in a brutal holiday price war with Amazon and Walmart.
At a Wednesday presentation at the company’s flagship store in Times Square, CEO Antonio Urcelay admitted 2013 was “disappointing” as he outlined plans for a strategic revamp.
The crucial fourth quarter was particularly painful, as the company swung to a $210 million loss amid steep discounts on slow-moving toys, which hammered gross margins to 31.8 percent of sales.
That’s more than 2 percentage points below the margin the company racked up a year earlier, when it generated a $239 million profit.
Toys ‘R’ Us — taken private in 2005 for $6.6 billion by KKR, Bain Capital and Vornado Realty — saw its sales drop 7.4 percent, to $12.5 billion, in the year ended Feb. 1.
With backrooms and warehouses stuffed with hard-to-move toys, the company wrote down the value of its US inventory by $51 million, it said.
The company’s struggles, along with a debt load of more than $5 billion that was used to take it private, have repeatedly thwarted efforts by its owners to take it public again.
In his first meeting with media and investors since he took the reins last October, Urcelay noted that macroeconomic forces haven’t helped the company, including the fact that birth rates have been declining since 2007.
Industry experts say toy sellers are likewise getting slammed by technology, as smartphones and tablet devices have increasingly become all-in-one distraction devices for kids.
Still, Toys ‘R’ Us has some reasons for optimism, Urcelay said, noting that US same-store sales are up 3.5 percent this year.
Insiders partly cite a recent rebound in demand for video games, as Sony’s PlayStation 4 and Microsoft’s new Xbox One are generating demand.
That’s good news, as sluggish demand for video games was partly to blame for a 4.1 percent same-store sales drop in the fourth quarter.
At Toys ‘R’ Us, the wounds mainly have been self-inflicted, according to Urcelay. In response, the company is stepping up its focus on customer service and simplifying prices even as it continues to cut costs.
The Post reported exclusively earlier this month that Toys ‘R’ Us was poised to cut as many as 200 jobs at its headquarters in Wayne, NJ, with more layoffs being eyed abroad.
On Wednesday, the company said it has eliminated just 100 employees at headquarters to date. But officials said a total of 500 jobs worldwide have been cut — and signaled that more reductions are being considered.
Toys ‘R’ Us has hired AlixPartners to cut costs at the corporate level as the chain scrambles to stem the flow of red ink, sources told The Post.
On Wednesday, Urcelay noted that 98 percent of the company’s US stores are profitable.