Mothercare swung into the red this morning and warned of a recent "softening in the UK market", sending shares into freefall.
The London-listed firm group posted six-month losses of £16.8m – which included £16.1m of additional costs.
Markets shuddered at the news with shares falling almost a fifth.
The retailer's chief executive Mark Newton-Jones said:
Towards the end of the reporting period, and in subsequent weeks, we have seen a softening in the UK market with lower footfall and spend which is consistent with recent industry reports.
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But Newton-Jones insisted the high street darling was "on track with our transformation plans".
Mothercare has pinned its hopes on a costly revamp that includes closing poorly performing stores and setting up new "club" outlets.
The chief exec added: "Not-withstanding this uncertain consumer backdrop, the Mothercare brand – whilst not immune– is in a stronger position with a much-improved product and service offer and a more robust business model."
Half-year like-for-like UK sales rose 2.5 per cent to £229m. International like-for-like sales fell eight per cent.
Mothercare was forced to splash out £7.1m of cash to plug the gap in its defined benefit pension scheme. By the end of September, its retirement pot still had a £68.9m shortfall.
Before taking into account all the firm's planned changes, Mothercare made £100,000 of cash from its operations. But this was quickly wiped out by £12.4m of capital expenditure and £8.9m of cash payments for "adjusted costs".
The firm was forced to go cap-in-hand to its banks, drawing down £24.5m on its lending facility over the period.