Mothercare suffers loss but is “confident” about Boots partnership

Mothercare store closures covid-19 pandemic lockdown boots trading update Clive Whiley
In the UK and Ireland, Mothercare recently launched a new franchise with health and beauty retailer Boots
// Mothercare suffers 39% loss in sales to £145m
// Mothercare UK went into administration last year with all 79 shops closed and 2500 jobs lost

Mothercare has reported a loss in its financial year to date, as store closures affected its trading amid the Covid-19 pandemic.

In the first 28 weeks of the current financial year, the maternity goods retailer saw sales decline by 39 per cent to £145 million.

Mothercare said the losses caused by store closures during the coronavirus lockdowns were only partially offset by the performance in those countries in which it was able to continue to trade via its online channels.


Mothercare, which continues to trade online and through overseas stores, last year put its UK stores into administration with all 79 shops closing and 2500 jobs lost.

As of September 23, 2020, the group’s total secured debt was £15 million while more money is expected from the administrators of its UK arm.

In the year to March 28, 2020, total group revenue slid by 18 per cent to £164 million while the previous year £2 million adjusted profit before tax turned into a £5 million loss.

However, Mothercare swung to a total profit of £14.4 million during the period from a loss of £97 million in the previous year.

The company added that 95 per cent of its partners’ global retail locations are now open, from a low point of 27 per cent in April.

Mothercare has introduced a new model where franchise partners pay for products directly to the manufacturing partners to improve working capital requirements.

Meanwhile, the retailer reported a recovery in the Middle East thanks to the reopening of stores after lockdown.

However, trading has still been challenging because of the declining tourism levels in the UAE due to the pandemic.

Trade continues to be challenging in the key markets of India and Indonesia due to the continuing impact of Covid-19 on footfall and consumer confidence.

“We have diligently managed our way through to mitigate the impact of the Covid-19 pandemic during this period of global crisis, and we emerge in better shape than we went into it. We continue to reduce costs and improve our efficiency,” Mothercare chairman Clive Whiley said.

In the UK and Ireland, Mothercare recently launched a new franchise with health and beauty retailer Boots, which will see its branded clothing, home and travel products sold in Boots stores.

The Mothercare range will begin to appear in over 400 of Boots stores from September 28.

In addition, the franchise partnership will see Boots opening dedicated Mothercare and premium nursery zones in 10 stores by November 13.

“We are now singularly focused upon building Mothercare as a global brand, both in our existing territories and beyond,” Whiley said.

“We are confident with these foundations now in place Mothercare can move forward as a profitable and cash generative international franchise business, generating revenues through an asset-light model in some 40 international territories.

“This would not have been possible without the support of all of our stakeholders whom, on behalf of the board, I would like to thank for enabling us to get to this point.

“As a result, from today, Mothercare can look forward to a brighter and stable future once more.”

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