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Mothercare UK like-for-like sales drop 8.8 percent in Q4

By Prachi Singh

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Business

Mothercare plc, for its 12 week period to March 30 2019 reported UK like-for-like sales (LFL) decline of 8.8 percent. The company said, improved UK LFL driven by clearance stock volumes in closure stores, which diluted gross margins but cleared all inventory in these stores. International retail sales were down 4.9 percent in constant currency and 4.5 percent in actual currency. The company added that retail sales in core markets declined 5.7 percent in constant currency driven primarily by economic and trading challenges in the Middle East, while growth in the quarter was observed in core markets of Russia, India and Indonesia.

Commenting on the trading update, Mark Newton-Jones, Chief Executive Officer of Mothercare plc, said in a statement: "We have continued to make significant progress in our final quarter as we continue our strategic transformation to deliver a sustainable and profitable future for Mothercare. The disruption we have seen from both the organisational changes and the UK store closures is now largely behind us. 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.”

As part of its ongoing transformation plan, Mothercare sold the Early Learning Centre to The Entertainer for 13.5 million pounds in March, enabling a further reduction in bank debt and a focus on our core strategic priorities, established three new internal divisions; Mothercare Global Brand, Mothercare UK and Business Services, completed the UK store closure programme ahead of schedule, closing 40 stores in the past three months. UK estate now consists of 80 stores, down from 137 in the prior year, representing a reduction in space of 30 percent. The company added that it is on track to deliver at least 19 million pounds of annualised cost savings.

Picture:Facebook/Mothercare

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