Nov 24, 2016
Mothercare slips back into the red
While the group posted its first annual profit in five years in May this year, progress has recently been hampered by poor overseas sales. International sales in the first half grew 7.7 per cent as the company extended its digital sales beyond the UK and opened three new international websites. On Thursday, Mr Newton-Jones - who tried to move away from steep discounting during his first year at Mothercare - said that "Unseasonal weather through the spring/summer season" in the UK resulted in higher markdowns. Total UK sales in the 28 weeks to October 8 were 2.3 per cent lower than the same period last year while like-for-like sales fell 0.7 per cent. Analysts at Peel Hunt said that although the group's results overall were ahead of their expectations, the blow to the UK arm meant they expected a full year UK loss of £3.4m. "The equity story is built on the UK returning to profitability and the digitalisation of international revenue streams," they said in a note.
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