Mothercare warns future is in the balance as Middle East partner plans to close stores
Mothercare has warned that its future is in the balance after its leading Middle East franchise partner said it expects to close a substantial majority of its franchised stores in 2027.
The mother and baby brand was notified on 17 September that the partner is reviewing its Mothercare franchise stores in light of the ongoing situation across a number of its territories. While the review is still underway, the partner has indicated it expects most of the franchised stores in the region to close.
Subscribe to TRBMothercare said this would materially reduce its order book for FY28, with a corresponding hit to revenues, profits and cash flows. Although the company said it has sufficient resources to continue trading for several months, it has launched a strategic review of its business model and cost base to “preserve value for stakeholders”.
It added: “At this stage the outcome of such a review and the longer-term solvency of the company remains highly uncertain.”
Clive Whiley, chairman of Mothercare, said: “Whilst our recent financial performance has been resilient, this is a heavy blow to the Mothercare business and our stakeholders. We will continue to pursue discussions to restore critical mass and value for stakeholders, against this more difficult backdrop.”
Last month, Mothercare reported that its revenue had declined to £22.4 million in the year to 28 March from £38.9 million a year earlier. Adjusted EBITDA fell to £1.3 million from a previous £3.5 million.
