Mothercare losses deepen as sales continue to slide
Source - SMW
Parents and young children focused retailer Mothercare reported a deeper annual loss, as the ailing company's sales continued to slide amid a raft of store closures.
Pre-tax losses for the year through March amounted to £87.3m, compared to losses of £72.8m on-year.
Revenue slid 14% to £566.3m, and was down by 12% on a continuing operations basis.
Like-for-like sales in the UK fell 8.9%, while international like-for-like sales fell 4.7%.
On a more positive note, the company delivered annualised cost savings greater than the targeted £19m and slashed its debt load.
'We have achieved a huge amount this year, refinancing, restructuring and reorganising Mothercare to ensure a sustainable future for the business,' chief executive Mark Newton-Jones said.
'The majority of that work is now done, including the completion of our store closure programme, leaving us with 79 stores which are well positioned to support our UK customer base.'
Mothercare recently sold its Early Learning Centre and head office, using the proceeds to cut debt.
At 31 March, its net debt stood at £6.9m, down from £44.1m a year earlier.
'Combined with a new approach to sourcing product and our organisational restructuring, we have a much reduced cost base,' Mark Newton-Jones said.
'Whilst this major restructuring activity has resulted in significant headline losses for the year, the business is now on a sounder financial footing.'
'The next phase of our strategic transformation plan is to develop Mothercare as a global brand, maximising the opportunities we see across many international markets.'
'At the same time our primary focus in the UK will be the development of our online proposition, the introduction of enhanced credit options and more exclusivity in product, coupled with a reinforcement of our specialist and service credentials.'
'In the early stages of this financial year, we are seeing some improving UK trends as we continue to rebuild to be the specialist retailer for parents and young children.'