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Mothercare: slowing online and growing LFL store sales ‘not a trend’

Mothercare looks to digital in challenging market

Mothercare chief executive Mark Newton-Jones today said that he did not believe that slowing online sales growth, combined with growing like-for-like store sales, represented a long-term change in behaviour for the retailer’s customers.

The retailer for the parents and carers of young children, a Leading retailer in IRUK Top500 research, today reported online sales growth of 3.3% in the 15 weeks to July 8, contrasting with growth of 6.4% in the same quarter a year earlier, and of 13.6% in the final quarter of last year. At the same time overall sales fell by 1.8% after a programme of store closures, although UK like-for-like sales, which strip out the effect of store openings and closures, were 1.9% up on last time. Group sales were flat.

Newton-Jones said: “We have continued to make progress in the UK during the period. We have seen customers respond well to our end of season sale, which we entered with less stock than last year, and are achieving a higher sell through rate. Whilst online sales recorded a lower growth, in contrast to higher sales growth in store, we don’t believe this represents an underlying permanent shift in customer behaviour. We are about to launch our autumn ranges, but it remains uncertain how consumers will respond to inflation.”

International retail sales rose by 2.2%, but when currency fluctuations were discounted they were down by 8.3%. Online sales grew by 78%, or 53% in constant currency.

Newton-Jones said: “In our international business, the challenging economic conditions in the Middle East continue and are impacting overall performance, and so the outlook remains volatile. We continue to export our learnings from the UK as our business improves here, to support our partners with the modernisation of their franchise businesses, and see further opportunities for growth both online and in stores.

“We remain firmly focused on our strategy, both here in the UK and internationally. Our vision remains clear: to be the leading global retailer for parents and young children.”

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