Mothercare seeks new sources of growth as it reports lower sales and growing losses – Brands


Image courtesy of Mothercare

Mothercare says online marketplaces are among the new opportunities she is considering following her transition from international retailer to brand.

The clothing and childcare equipment business now focuses on the design, development and supply of products which are sold through international franchise partners in more than 700 stores in 37 countries. This, he says, freed it from the “burden of a UK store fleet, warehousing and associated operational costs”

However, this has yet to return it to profitability, with declining sales and increasing losses largely attributed to the effects of Covid-19. Mothercare today announced revenue of £ 85.8million in the year until March 27. This is 47.9% less than the previous year. Pre-tax losses widened to £ 21.5million from £ 8.5million a year earlier. The retailer now aims to repay net debt of £ 13.5million within five years and improve profitability.

In the UK, Boots is its franchise partner and Mothercare products have been available in Boots stores and on its website since last fall. Today, he estimates that more than 80% of franchisees’ stores are now open since the closures, although trade is difficult in markets like Russia, India, Indonesia and Malaysia due to the effect of Covid-19 on these markets on footfall and consumer confidence. While sales grew rapidly online during the pandemic, that, he says, was not enough to offset the effect of temporary store closings.

Looking ahead, he now sees opportunities for growth in new markets, as Mothercare products are yet to be sold in seven of the top 10 baby clothing and equipment markets around the world. These include online marketplaces as well as wholesale and licensing.

Clive Whiley, President of Maternal care, says: “The past financial year has clearly been difficult, however, despite the context of the pandemic, we have made enormous progress in the fundamental transformation of the group.

“We anticipate 2022 to be a year of further progress as we focus on developing our strategy and future plans to optimize the Mothercare brand globally over the next five years. These are exciting times because, despite the continued impact of the pandemic on many territories of our franchise partners, without the distractions of the past three years, we seek to accelerate the growth of the Mothercare company and brand. We look to the future with great optimism after building a strong and efficient platform with multiple opportunities for growth. “

The brand claims that in the first thirteen weeks of its current 2022 fiscal year, retail sales reached £ 94million and adjusted profit before interest, taxes and asset impairment (EBITDA) was around £ 2.5million.


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