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Mothercare full year profit rises on turnaround efforts

By Prachi Singh

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Business |REPORT

Underlying profit before tax at Mothercare for the full-year period to March 26, 2016 was up 51 percent at 19.6 million pounds (28.5 million dollars). The company achieved further progress in UK with margins up 70 bps, online sales growth of 15 percent, like-for-like sales growth of 3.6 percent and losses reduced by 64 percent. However, its international business continues to remain challenging with economic and currency headwinds impacting profits, which were down 12 percent.

Commenting on the company’s performance, Mark Newton-Jones, Chief Executive of Mothercare said, “I'm pleased to report that two years into our turnaround strategy we have recorded a 51 percent growth in underlying profit before tax and the delivery of our first statutory profit in five years. The results highlight the significant progress we are making towards returning the UK to profitability.”

International sales remain challenging

Total international sales declined 7.5 percent from 745.4 million pounds to 689.7 million pounds for the year under review.

“Conditions for our international business remain challenging. The issues are primarily at a macro level, with economic and currency headwinds persisting,” added Newton-Jones, further elaborating on the measures initiated by the company to drive growth.

“Whilst we recognise these pressures, we believe that we can also make some improvements in how we operate. We are exiting underperforming stores whilst continuing to grow space where there is potential for long term growth. We are also taking the lessons learned from our success in the UK and exporting them to our international markets,” he said.

pics:mothercare.com

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