Mothercare: Trading holds firm
Babycare retailer Mothercare said today it had traded resiliently in the UK, despite a 1.8% fall in like-for-like sales for the 15 weeks to July 8.
The group, which is two-thirds of the way through a modernisation drive, reported a difficult trading environment and said the early timing of Easter compared with last year had distorted the first quarter figures.
Total UK sales for the period were up 0.1%, while the 1.8% decline in same-store business was against growth of 4.8% for the period a year earlier.
Mothercare told shareholders ahead of its annual meeting: “Our UK business has traded resiliently in the difficult UK trading environment.”
During the two years of the overhaul, Mothercare has boosted its share of the children’s clothing market by improving the quality, design and value of its ranges.
The group has also improved product availability and made its distribution chain more efficient through a £13m (€18.9m) logistics centre at Daventry.
The first part of the move to the new site was completed in May – on time and to budget – with the whole transfer due by the middle of next year.
Total sales were 3.3% higher during the 15-week period, as Mothercare benefited from the continued development of its international operation.
Overseas business increased by 30.7% as 16 new sites took the company’s international portfolio to 236, more than the UK – where it has 235 shops following the opening of five new stores this year – for the first time.
Earlier this year, Mothercare announced that pre-tax profits before exceptional items rose by 19% on a year earlier to £19.6m (€28.5m).
The bottom-line figure was £15.5m (€22.5m), which analysts expect to increase to more than £21m (€30.5m) this time.
Mothercare indicated further profits progress in today’s statement, as it said margins continued to show satisfactory growth.
