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Tuesday 15 October 2019

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Mothercare sales drop as more stores are shed

Written by Peter Walker
26/07/19

Mothercare’s store closure programme has affected total UK sales, which were down 23.2 per cent for the 15 weeks to 13 July.

Like-for-like sales improved by 3.2 per cent, but online sales fell by 12.1 per cent.

The baby and mother product retailer is currently in talks to sell or separate its UK store estate, months after striking a deal with creditors that secured its survival. This now comprises of 79 stores, down from 134 last year.

“The UK retail market remains challenging and though the rate of decline in like-for-like sales has moderated, margin investment in promotional activity has been necessary to stimulate sales, both in our stores and online,” said chief executive Mark Newton-Jones.

“Despite a difficult backdrop, we continue to improve our customer offer and have launched a number of new initiatives including specialist sales and service training to all our store colleagues,” he continued, adding: “The process of restructuring and rebuilding a sustainable business continues, and we have in place financing plans to support these actions as we aim to be bank-debt free by the end of the year.”

A statement explained that the immediate priority is to complete the transformation of the business, with a near-term focus on evolving and optimising the ownership, structure and model for UK retail operations as an independent franchise.

Last month, Mothercare reduced the size of its board of directors in an attempt to overturn its financial losses.

Newton-Jones said more restructuring experts had been brought in and the board now has directors who are more hands-on with the company’s restructuring.

Mothercare said it will provide a further update on 28 November.


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