Nursery and maternity retailer Mothercare posted its full year results last week, shortly after announcing restructuring plans which would see it taking on a CVA and closing 50 stores, while also reinstating previous ceo Mark Newton-Jones.
The disappointing report saw the retailer reporting statutory pre-tax losses of almost £73m in its latest financial results – a significant drop from a profit of £7.1m in 2017. This was due to the costs associated with restructuring and closures, as well as store asset impairments and onerous leases.
Mothercare said the first six months of the financial year had been ‘positive’ but was followed by a ‘very difficult’ second half, where UK sales were impacted by reduced footfall.
Online sales have continued to rise and now account for 43% of Mothercare’s UK sales.
“Against this difficult backdrop, the business managed its cash tightly and delivered lower net debt than our January guidance. However, profit is significantly lower than in the previous year,” said chief executive David Wood.
“The business has modernised significantly over recent years, but we expect the changing dynamics and challenges in the retail sector to continue, so we need to move faster with the execution of our transformation plans.”
Mothercare has also confirmed that Mark Newton-Jones agreed to a 20% pay cut when he rejoined the firm as ceo, less than 40 days after he was initially ousted.