MOTHERCARE chief executive Simon Calver yesterday said the baby products retailer was on track with the turnaround of its UK business after narrowing its losses last year.
The retailer’s domestic arm, which accounts for 40 per cent of group sales, made a loss of £21.7m for the year to 30 March, an improvement on its £24.7m loss a year earlier. The decline in UK like-for-like sales also slowed to 3.6 per cent compared with a 6.2 per cent decline the previous year.
Calver, who laid out a three-year plan last year, said 56 loss-making stores were closed last year – ahead of his original target of 50 – with another 30 to close this year.
He said the group’s “root and branch approach” to make business profitable was taking effect but warned it “would not happen overnight”.
“It is still early days and our customers are already beginning to respond positively buying more products on each trip and increasing their customer satisfaction scores,” he added.
Kate Calvert, Cantor analyst however, said she remained unconvinced.
“Management is undertaking this brand repositioning in challenging markets where competition is fierce,” she said.
Mothercare’s overseas business continued to outshine its UK performance, with profit up 20 per cent to £42m on sales up more than 8.4 per cent to £730m.
Total group sales fell 7.8 per cent to £749.4m due to store closures while underlying pre-tax profits jumped from £1.6m to £8.3m.