Mothercare has reported a 4.4 million pound adjusted loss before tax for the first half of the year compared to a profit of 4 million pounds last year.
It comes as the maternity and childrenswear specialist nears the end of its major restructuring plan announced in November 2019.
The company announced in its half-year results on Thursday that it has secured a 19.5 million pound loan from Gordon Brothers Brands which will be used to repay outstanding debt.
Net debt at the retailer now stands at 17.5 million pounds, down from 13.7 million pounds on 28 March 2020 and 24.5 million pounds on 12 October 2019.
Worldwide sales at the company dropped 42.4 percent to 189.2 million pounds in the first half of the year, while total group revenue fell 56.5 percent to 44.4 million pounds.
During the period, the retailer launched its new 10-year UK and Ireland franchise deal with Boots, and entered into a new 20-year franchise agreement with Alshaya, its largest partner.
In August, the company announced the launch of a “more sustainable and less capital-intensive” business model from the AW20 season, following the collapse of the company into administration last year.
Commenting on the results in a statement, CEO Clive Whiley was upbeat that the business’ restructuring phase was “all but complete” and that the company emerged from the period “in better shape” than when it entered.
“We have refinanced the business alongside commencing our new arrangements with Boots for the UK and Ireland and we are now operating our innovative, working capital-light arrangements with our manufacturing and franchise partners around the globe for the Autumn/Winter 2020 collections,” he said.
“With these foundations in place Mothercare can move forward again with confidence as a profitable and cash generative international franchise business both in-store and online, generating revenues through an asset-light model in the UK and some 40 international territories.”
Photo credit: Mothercare