Mothercare makes good progress in UK
Mothercare increased its UK like-for-like sales by 3.8% in the first half of its financial year as the retailer hailed the good progress made a year into its turnaround.
In the 28 weeks to 10 October, Mothercare reported an underlying loss of £6.1 million in the UK compared to loss of £13.5 million in the comparable period last year.
Meanwhile, online sales in the UK rose by 22.1% as the retailer benefited from its digital strategy of improving the customer journey online and introducing more iPads in stores.
Mark Newton-Jones, chief executive of Mothercare, said: "We are a year into our turnaround; making good progress against each of our strategic pillars and as a result underlying profits for the first half have more than doubled."
"Our work to return the UK business to profitability continues to pay off, with growth in both gross margins and like-for-like sales. Improved product architecture, better buying and a focus on full price retailing helped drive the stronger margin growth. Our new store format is going down well with customers, and these refurbished stores are delivering encouraging uplifts in both sales and profit. The UK is annualising against our new trading approach and is performing well; but there is still more work to do."
International like-for-like sales declined by 2.3% year-on-year with sales in Europe flat and sales in the Middle East, Asia and Latin America weaker.
Newton Jones added: "We continue to lay the foundations for future growth in our International business. Despite increased economic and currency headwinds in a number of our markets, impacting both sales and profits, we and our franchise partners remain confident in the business model and together continued to grow space. We expect the challenging environment to continue into the second half."
Across the wider Mothercare group, total group sales declined 6.1% to £349.9 million while group underlying profit before tax rose by 112% to £7 million.
Newton-Jones said: "Overall, expectations for the full year outturn are unchanged. Our vision remains clear: to be the leading global retailer for parents and young children."
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