Mothercare today said that it had completed its UK store closure programme ahead of schedule. As of April 3, the retailer now has 80 stores, after closing 30 over the past three months. That means that Mothercare has reduced its UK store floor space by 21.2% over the last year. The retailer said that it was on track to deliver savings of at least £19m a year as a result.
The closures are part of a wider transformation programme that have already seen Mothercare sell its Early Learning Centre business to The Entertainer for £13.5m and reorganise its structure into three divisions – Mothercare’s global brand, its UK business and a business services division.
Group sales were down by 13.9% in the 12 weeks to March 30 compared to the same time last year. UK sales were down by 14.5% in the quarter, while like-for-like sales, which strip out the effect of store openings and closures were down by 8.8%. International sales were down by 4.9% in quarter.
The fourth quarter figures represent a recovery from the third quarter, when group sales were 18% down on the previous year. In the full-year, group sales are put at 14.6% down in the full year, to March 30, with UK sales down by 15.4% in total, and by 10.8% on a like-for-like basis.
“The UK store closure programme has been completed ahead of schedule and we now have 80 stores in operation, down from 137 stores a year ago. Whilst this has been a difficult but necessary process, to right-size the UK, it has meant that we have had to say goodbye to many loyal and longstanding colleagues. Their approach and professionalism have been outstanding right until the last day of operation for which we thank them sincerely.”
The retailer now aims to be debt free by the end of 2019, partly as a result of the sale of the ELC business. “The disruption we have seen from both the organisational changes and the UK store closures is now largely behind us,” said Newton-Jones. “We expect a continued impact on our business given the volume of clearance stock we have sold in recent months. Against this background, we remain on track to deliver on our full year expectations.
“Looking ahead, we expect market conditions in the UK and in some international markets to remain challenging. We enter the new financial year in a more robust position as a restructured business fit for the future and with reduced levels of debt. We have a significantly smaller UK store estate and our international operations remain cash generative. We look forward to the new financial year and to delivering the next phase of our strategic transformation plan."
Image courtesy of Mothercare