Despite a decline in sales, Mothercare is expecting profit for the full year ended 30 March 2024, to be marginally above the £6.7m achieved in FY23.
Unaudited net worldwide retail sales by franchise partners were £281 million, compared to £323 million in the previous year, a decline of 13%.
Middle East markets which make up 41% of Mothercare’s total retail sales, continued to be the most challenging. The UK and Indonesia were among the markets which increased retail sales year-on-year.
Net debt at year-end was £14.7m. Pension scheme deficit for the year remains at £35m.
Mothercare expects the global economic uncertainties which are impacting retail sales and the partners still clearing inventory following suppressed demand during Covid, to continue to impact results in 2025.
The medium term guidance is unchanged for the steady state operation in more normal circumstances. Mothercare continues to believe its continuing franchise operations remain capable of exceeding £10m operating profit and it maintains focus on accelerating growth in both existing and new markets.
Clive Whiley, chairman of Mothercare, commented: “As highlighted in my last chairman’s statement, it has been six years of hard work and transformative change for the group and, on behalf of the board, I would like to thank our colleagues across the business, alongside our pension trustees and all other stakeholders for their unstinting support during these difficult times. That support and the resilience we have built into the business throughout this journey, allows us to deal with the major challenges we have faced and Mothercare operations would not be in the profitable and cash generative position we are today without it.
“Given the exogenous factors influencing some of the company’s operating markets, our immediate priority remains to support our franchise partners, ultimately for the benefit of our own business, however we have also redoubled our efforts to restore critical mass and are focused upon monetising the Mothercare global brand IP. This remains an exciting prospect for our partners, our colleagues and all stakeholders.”
