Mothercare turnaround plan on track despite currency headwinds

 
Catherine Neilan
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Mothercare is part-way through a significant overhaul implemented last year (Source: Getty)

Mothercare's turnaround is on track after a solid second quarter performance, despite challenges from foreign currency headwinds.

The childcare retailer, which is part-way through a significant overhaul implemented last year by chief executive Mark Newton-Jones, has grown UK like-for-likes 6.5 per cent, while total UK sales rose 1.8 per cent.

Online sales under the former Shop Direct boss have surged 20.4 per cent in the 13 weeks to 10 October.

International sales on a constant currency basis rose 5.6 per cent, although on actual currencies registered a fall of 5.3 per cent.

One of Newton-Jones' new strategies is to avoid discounting and focus instead on selling products at full price. Today's update said this had yielded “further growth in gross margins”.

Newton-Jones said: “Our improved and exclusive product ranges in home & travel and clothing & footwear are supporting our full price trading approach. As a result we were able to go into our end-of-season-sale with less product at discount and so delay the start of the sale until the second quarter.

“With Christmas now quickly approaching we are gearing up to our peak trading period.

"These results give us further confidence in our strategy, but there is much more to be done. Our vision remains clear - to be the leading global retailer for parents and young children."

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