Kiddieland International Limited board of directors announced that based on a preliminary review of the group's unaudited consolidated management accounts for the year ended 30 April 2018, the revenue of the Group for the said period has decreased by more than 10% as compared to that for the year ended 30 April 2017. The Group also recorded a decrease in gross profit margin in fiscal 2018 and is expected to record a loss for fiscal 2018 as compared to the net profit of approximately HKD 22.6 million for fiscal 2017. The decrease in revenue of the Group in fiscal 2018 compared to that in fiscal 2017 was mainly attributable to: the decrease in average selling price of products sold to U.S., which was primarily due to a major customer in the region having changed its procurement arrangement from POE terms to FOB terms since June 2017; the Group's voluntarily restraining the supply of goods to the various subsidiaries of Toys "R" Us Inc. in the second half of fiscal 2018 in view of TRU's filing for Chapter 11 bankruptcy in September 2017 and its subsequent liquidation announcement made in March 2018 as settlement of trade receivable from TRU could potentially be questionable; and the continuing sluggish economic growth in Europe and the adverse sentiment of the toy industry due to the TRU Crisis which resulted in a substantial decrease in the Group's sales to the customers in Europe as well as the decrease in average selling prices of products. The loss expected to incur by the Group in fiscal 2018 was mainly attributable to the decrease in gross profit margin as a result of: the decrease in average selling prices; the significant increase in unit cost of plastic resin and printed box driven by the rapid increase in oil price and paper products which were beyond the Group's expectation and control; and the sudden appreciation of RMB against HKD and USD, which increased the operating cost of the Group's operations in the PRC. In addition, the Group suffered a provision of impairment on account receivable in relation to sales to TRU and its group companies and another provision of impairment on inventory for obsolete stock which stemmed from TRU proprietary products due to the TRU Crisis.