Mothercare pushed into loss by UK business

Mothercare store Mothercare aims to revive its UK business over the next three years

Babywear retailer Mothercare has reported a hefty annual loss as the retailer takes steps to turn around the fortunes of its struggling UK business.

Losses for the year to 31 March were £102.9m, compared with a profit of £8.8m the year before.

The loss came after Mothercare wrote down the value of assets and took charges related to UK store closures.

Mothercare currently has 311 UK stores, but earlier this year it said it would cut this number to 200 by March 2015.

The retailer - which also operates under the Early Learning Centre brand - took a one-off charge of £104.4m to cover the costs of revamping its UK business.

"We have a long way to go, and the plan to bring the UK business back to acceptable levels of profitability will take three years," said chief executive Simon Calver.

Total sales at the company rose 6.4% to £1.23bn, but the growth was driven by Mothercare's stores outside the UK.

In the UK, total sales fell 4.6% to £560m, with like-for-like sales - which strip out the impact of store openings and closures - down 6.2%.

The firm said its UK business had struggled in the face of "a challenging economic backdrop" as well as increased competition.

However, total international sales rose 17.8% to £672.4m, with like-for-like sales up 6.1%.

Mothercare currently has 1,339 owned and franchised stores worldwide. Outside the UK, it has 409 in Europe, 318 in Asia, 290 in the Middle East and Africa, and 11 in Latin America.

New strategy

Mothercare issued two profit warnings last year, and its previous chief executive, Ben Gordon, stepped down in November.

Mothercare launched a major review of its business last year and has now outlined its plans for the next three years.

This includes shrinking the number of its UK stores to 200 and cutting costs in non-store operations.

It also aims to "rapidly expand" the number of stores it has in fast-growing overseas markets such as India, China, Russia and Brazil.

The retailer is also aiming to improve and expand its e-commerce business. It launched a new website for the UK at the beginning of May.

More on This Story

Related Stories

The BBC is not responsible for the content of external Internet sites

More Business stories


Features & Analysis

  • Stained glass of man with swordFrance 1 England 0

    The most important battle you have probably never heard of

  • Golden retriever10 things

    Dogs get jealous, and nine more nuggets from the week's news

  • Pro-Israel demonstrators shout slogans while protesting in Berlin - 25 July 2014Holocaust guilt

    Gaza conflict leaves Germans confused over who to support

  • The emir of Kuwait Sheikh Sabah al-Ahmad al-Jaber al-SabahFreedoms fear

    Growing concern for rights as Kuwait revokes citizenships

Elsewhere on the BBC

  • CastleRoyal real estate

    No longer reserved for kings and queens, some find living in a castle simply divine


  • Leader of Hamas Khaled MeshaalHARDtalk Watch

    BBC exclusive: Hamas leader on the eagerness to end bloodshed in Gaza

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.