MOTHERCARE posted a bigger-than-expected drop in first-quarter sales in its main British market – but thrived in foreign markets.
The mother and baby retailer, which has 1,115 stores in 52 countries but makes about three quarters of its revenue in Britain, said sales at UK stores open at least a year fell 4.1 per cent in the 15 weeks to July 10.
Including VAT sales tax, the decline was 2.8 per cent.
Analysts had expected a fall similar to the 1.6 per cent reported in the fourth quarter of last financial year, though they also noted that comparable figures from the year before had become tougher.
“In the UK we continue to plan cautiously for the remainder of this year,” Chairman Ian Peacock said.
“In this context, we expect to invest further margin in our customer offer which will be offset, in part, by cost savings and our property restructure.”
Britain’s retailers are worried that steps to cut government borrowing, such as higher taxes and public spending cuts, will hit consumer demand in the months ahead. A survey on Wednesday showed consumer morale at its lowest for a year.
Mothercare said international sales rose 20.3 per cent, led by eastern Europe, the Middle East and Asia, ensuring group sales climbed 0.4 per cent.
The group also said it had agreed to buy maternity-wear brand Blooming Marvellous for an undisclosed sum.