Mothercare losses widen
Mothercare has reported widening full year losses after a period of refinancing, restructuring and store closures.
In the 53 weeks o 30 March, the retailer increased its pre-tax loss to £87.3 million from £72.8 million in the previous year.
While UK like-for-like sales fell by 8.9% in the period, international retail sales edged down 0.3% at constant currency. However, the retailer said its core overseas markets of Russia, China and Indonesia had all seen growth in the year.
Mothercare said its like-for-like sales in the UK had been impacted by reduced consumer confidence in the brand following its refinancing as it looked to turn its struggling business around. The retailer also embarked on a restructuring exercise that included reducing its store space by around a third.
Commenting on the results, Mark Newton-Jones, chief executive of Mothercare, said: “We have achieved a huge amount this year, refinancing, restructuring and reorganising Mothercare to ensure a sustainable future for the business. The majority of that work is now done, including the completion of our store closure programme, leaving us with 79 stores which are well positioned to support our UK customer base.
”We have also sold Early Learning Centre and our head office, and the proceeds have been used to greatly reduce our debt. Combined with a new approach to sourcing product and our organisational restructuring, we have a much reduced cost base.”
Newton-Jones said the restructuring activity had put Mothercare on a sounder financial footing.
Looking ahead, he said: “The next phase of our strategic transformation plan is to develop Mothercare as a global brand, maximising the opportunities we see across many international markets. At the same time our primary focus in the UK will be the development of our online proposition, the introduction of enhanced credit options and more exclusivity in product, coupled with a reinforcement of our specialist and service credentials.”
