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Mothercare and Quiz report on contrasting retail experiences

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Mothercare this week reported growing online sales – which accounted for 49% of all transactions in the fourth quarter of its financial year – but falling in-store footfall and sales.

The retailer for parents of young children, ranked Top50 in IRUK Top500 research, said group sales fell by 0.3% in the 12 weeks to March 24, and by 1.9% over the full year. Total UK sales fell by 5.6% in the quarter and 4.8% in the full year in tandem with floor space, which fell by 10.7% over both periods, while UK like-for-like sales which strip out the effects of store openings and closures, were down by 2.8% in the 12 weeks to March 24, and by 1.3% over the full year.

Online sales rose by 2.1% in the fourth quarter and 1.2% in the year. Stronger online growth came via the website (+7.2% Q4/+2.8% FY) but sales via in-store iPads fell (-4.8% Q4/-1.1%FY).

International sales were also down: by 11% in the quarter and 5% in the year.

Chief executive David Wood said group performance was in line with previous guidance.

“The UK retail trading environment remained relatively muted in the quarter, with a continuing trend of lower footfall in stores, though there was an encouraging return to growth online, with website sales in particular growing at 7.2%.,” he said. “In this competitive climate, promotional activity has been necessary to stimulate customer demand.

He added: “My immediate priority is to ensure Mothercare is put back on a sound financial footing and to improve its financial performance. We continue to make good progress in reducing the size of our UK store estate in response to changing consumer preferences and in reducing our central cost base, but our central focus must be customers and their experience, securing Mothercare’s reputation as the number one specialist for parents.

“We remain in constructive dialogue with our financing partners with respect to our financing needs for FY19 and beyond, and we continue to explore additional sources of financing to support and maintain the momentum of our transformation programme. All of these discussions are on-going and further updates will be given as appropriate.”

Meanwhile, multichannel fast fashion retailer Quiz , a Top150 trader in IRUK Top500 research, reported sales of £116.4m in its latest financial year – a rise of 30%, or 36% when £4.4m of one-off wholesale revenue from Spain the previous year is excluded.

Online sales grew particularly quickly – growing by 158% to £30.6m in the year to March 31, compared to the previous year. Quiz said this reflected investment in marketing and a broadening of the product range to include Curve and Bridal ranges. The online figure shows sales through Quiz’s own websites as well as through third party sites. International sales of £21.2m were 4% up on last time, while revenue from UK stores and concessions came in at £64.6m, 12% up on last time, achieved, said Quiz both through like-for-like growth and through new store openings. Seven concessions and five standalone stores were opened during the year.

Chief executive Tarak Ramzan said: “We are delighted to have successfully completed our first financial year since our IPO in July. This strong performance reflects the growing strength of the Quiz brand and the continued growth across each of our sales channels and target markets.

“We look forward to expanding the Quiz brand as a global fast-fashion destination for customers who want the latest looks at outstanding value with initiatives such as the launch of own language international websites and the continued expansion of our product range. We are confident that the Quiz brand’s distinct USP, strong customer connection and fast-fashion credentials provides a strong foundation for delivering future growth.”

Supplied by Quiz PR agency Hudson Sandler (Sophie Lister)

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