Mothercare profits boosted by international stores

Babycare retailer Mothercare relied on the benefits of its overseas expansion today after conceding that costs in the UK were rising faster than its profits.

Mothercare said its 232 stores in the UK generated 17% less profit than a year ago as higher rents, energy bills and wage deals with staff took their toll.

Like-for-like sales also fell by 1% in the UK as Mothercare cut prices to compete with rivals and shoppers were less willing to splash out on the high street.

But the retailer was able to report a 3% hike in group sales to £250.4m (€368.6m) and a 4.6% uplift in pre-tax profits to £11.4m (€16.8m), largely due to its performance overseas.

Mothercare has 247 international outlets – more than in its UK market - and these generated profits of £4.6m (€6.8m), 15% higher than a year ago.

This has encouraged bosses to flag the potential for at least another 150 overseas branches over the next five years. Mothercare recently signed a franchise agreement to open 40 stores in India.