Mothercare losses widen despite like-for-like rise

The business racked up £16.8m losses in the 28 weeks to October 7, up from £0.8m. The business attributed this increase to property and restructuring costs relating to its transformation plan.

Adjusted losses stood at £0.7m, compared to a profit of £5.9m last year.

UK like-for-likes rose 2.5%, although total sales fell 1% to £229m.

International sales dived 8% on a like-for-like basis and 7.7% on a total constant currency basis to £398.9m. Global total sales dropped 1.4% to £627.9m.

Mothercare is currently in redundancy consultation with 200 staff, and has suffered something of an exodus of senior staff.

Chief customer officer Andy Harding, chief financial officer Richard Smothers and retail boss James Graham have all quit the business in recent months.

Despite the poor profit performance, boss Mark Newton-Jones was adamant that the retailer’s turnaround plan was on track.

He said: “We remain firmly committed to our vision to be the leading global retailer for parents and young children. We have built further strength in personal service, advice and expertise, whilst sharpening our focus on our core markets of maternity, newborn, baby and toddler up to pre-school.

“We are reducing our cost base as we become an even leaner and simpler business, and we have identified opportunities to go faster in this respect.

“Towards the end of the reporting period, and in subsequent weeks, we have seen a softening in the UK market with lower footfall and spend which is consistent with recent industry reports.

“Not-withstanding this uncertain consumer backdrop, the Mothercare brand, whilst not immune, is in a stronger position with a much-improved product and service offer and a more robust business model.”

He added that there was “no clear sight as to when things will bottom out” in the Middle East, where its performance dragged down international sales.