Mothercare rebirth steps up as it plans to shut more stores

Paterniano Del Favero
Mag 19, 2017

It said its United Kingdom business returned to underlying profit for the first time in six years and worldwide markets showed signs of recovery with strong growth in Russian Federation and Indonesia, and a sales recovery in China, albeit the country is yet to return to positive cash profit.

The group enjoyed a 1.1 per cent increase in like-for-like United Kingdom sales in the 52 weeks to 25 March 2017, although total sales fell slightly to £459.4m for the year.

"Store managers' responsibility will be to build a database of the surrounding community to drive online and store sales".

"We are clear in the role our stores will play for the future, by offering specialist advice and service and first class product presentation", chief executive Mark Newton-Jones said.

"Digital revenue is on a trajectory to be over half of our turnover", Newton-Jones said, adding that store numbers will reduce over time as Mothercare focuses on a regional presence in "key conurbations across the UK". Underlying profit however inched up from £19.6 million to £19.7 million.

His turnaround efforts have been helping return the United Kingdom arm to health, with the group seeing its first underlying profit for six years in the final half of its financial year - with a surplus of £4.4 million.

Mothercare has already shut 100 shops as part of its overhaul launched three years ago, switching two-thirds of the store estate to out-of-town locations, while 70% has been refurbished.

The overhaul also involves scrapping ranges for older children, opting to focus clearly on the maternity and baby market.

The firm's full-year results showed like-for-like sales rose by 1.1% in the United Kingdom, while its digital push helped online sales rise 7.8% over the year, accounting for 41% of United Kingdom sales.

Its global arm has received a boost from the pound, which helped flatter sales over the year, up 10.6%.

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