WASHINGTON (dpa-AFX) - Build-A-Bear Workshop, Inc. (BBW) on Monday lowered its revenue outlook for fiscal year 2018 in conjunction with its presentation at the ICR Conference 2019.
For fiscal 2018, Build-A-Bear Workshop now forecasts total revenues in a range of $335 million to $340 million. Earlier, the company forecast full-year revenue in a range of $340 million to $345 million.
Total revenues were $364.0 million for the recast 53-week period ended February 3, 2018.
The revised full-year revenue outlook is inclusive of the negative impact of $3.9 million due to the adoption of new accounting standards effecting the timing of the recognition of breakage revenue for certain gift cards and the non-occurrence of the prior year benefit of $6.0 million for a 53rd week in revenue.
The company noted that the $9.9 million impact of these two items would adjust total fiscal 2017 recast year revenues to $354.1 million.
Within the company's Direct-To-Consumer segment, total revenues in North America are expected to decline by about 2 percent compared to the adjusted recast 2017 fiscal year. Total revenues in Europe are expected decline in the range of 17 percent to 20 percent compared to the adjusted recast 2017 fiscal year.
Sharon Price John, Build-A-Bear Workshop Chief Executive Officer said, 'We believe that fiscal 2018 had several anomalies that converged to negatively impact our business. The shortfall in our year's results are largely attributed to the persistent and significant revenue and profitability challenges in the UK as unresolved issues related to Brexit negatively impacted consumer confidence and currency exchange rates and new privacy laws, known as GDPR, impeded our marketing communications.'
The CEO noted that other factors contributing to the lower revenues include a decline in licensed product sales due to significantly fewer family-centric, character-based movies; the continuation of overall declines and changing composition of mall traffic; the closure of a flagship store location that represented over $7 million in North American revenue; liquidation of one of the largest global toy retailers; and a number of accounting and tax changes that negatively affected both top and bottom line results.
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