Toys R Us Expects Loss to Narrow

Toys R Us Inc., the No. 2 U.S. toy retailer, said it will post a narrower fiscal first-quarter loss after the company reduced costs and shoppers bought more toys at remodeled stores.

The loss in the period ended May 4 was as little as 2 cents a share, less than the year-earlier loss of 9 cents, the toy seller said. The retailer was expected to lose 9 cents, the average estimate of analysts polled by Thomson Financial/First Call.

The retailer sold more exclusive items, which carry higher profit margins, and reduced costs after cutting jobs, closing stores and combining parts of some divisions, investors said. Chief Executive John Eyler is improving service and remodeling stores to win customers from Wal-Mart Stores Inc., the No. 1 toy seller.

Shares of Paramus, N.J.-based Toys R Us fell 11 cents to $17.09 on the New York Stock Exchange. The stock has declined 17% this year.