Mothercare: still performing badly

15 April 2016

Mothercare Mothercare have been on the Deathwatch for a while now, as their shares again are falling. Worldwide, their shares have fallen by 21%, which is clearly bad news.

The retailer has blamed low oil prices in the Middle East, as well as weak consumer confidence in China for this, as sales fall across their business. They have a plan to get things moving in the right direction, and it may well be working, as they've seen an eighth-consecutive quarter of like-for-like sales growth in the UK.

They haven't seen a huge growth, but progress is progress, and one of the reasons for this, is Mothercare's refusal to discount. The company has also been closing under-performing shops in the UK, including those under the Early Learning Centre brand. They now have 170 stores, and 40% of those have been refitted and tarted up.

They've also seen improved sales online, which of course, is key to the success of many retailers.

However, Mothercare has a tricky balancing act - in the years when it performed badly in the UK, international sales kept it afloat. Now, the company is seeing growth in the UK, while its international business is struggling. Their sales outside of the UK fell 10.8% over the final three months of its financial year.

Mothercare said in a statement: "In the Middle East consumer sentiment was impacted by the sustained lower oil price, resulting in a significant decline in constant currency sales. In Asia, China in particular, was affected by weakening consumer confidence. Europe and Latin America were impacted by adverse currency moves."

Chief executive Mark Newton-Jones: "In the year ahead, we expect to make further progress in the UK. However, our international markets are likely to remain challenging with the current trends in space, sales and currency continuing into the new financial year."

TOPICS:   High Street News

2 comments

  • Captain.Cretin
    High prices wouldnt matter if the products were good; however we stopped shopping there because so much of what they had on the shelf was badly made tat. I have no issues with "Made in China", the Chinese CAN turn out good quality products, but what MC sells is more like the turds the Chinese make for their own citizens, but at ten times the price.
  • RippedoffBriton

    Low oil prices in the middle east?  I'll tell you why mothercare are struggling, it is because they are overpriced! You can get the same stuff cheaper pretty much anywhere!

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