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Mar 13, 2019

Build-A-Bear workshop cites Brexit woes for sluggish sales

Build-A-Bear Workshop celebrated the launch of its new store format today at a grand opening ceremony at Mall of America in Bloomington, Minnesota.

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It’s a tongue-twister in the making: Build-A-Bear is bearish on Brexit.

The toy company partly blamed waning consumer confidence in the U.K., its largest international market, for sluggish sales in the past fiscal year as Britain approaches the deadline to leave the EU with no deal in place.

Revenue in the year that ended Feb. 2 fell 7.5 per cent from a year earlier to US$336.6 million, the St. Louis-based company said Wednesday. Sales in Europe sank almost 18 per cent. Build-A-Bear Workshop Inc. said “the situation in the United Kingdom still poses a challenge.”

Even so, the company said it’s moved beyond other issues that impacted it last year, including the liquidation of Toys “R” Us and a significant drop in family-centric movie properties. Build-A Bear expects to return to profitability this year. Revenue growth will be in the mid- to high- single digits, as it invests more in its e-commerce operations and expands its non-retail revenue streams.

The shares fell as much as 6.4 per cent in early trading in New York.