Mothercare plots growth for Early Learning Centre

Mothercare said today it would look for further growth from the Early Learning Centre as it plans its response to uncertain trading conditions in Ireland and the UK.

The group intends to develop ELC overseas and online, as well as continue the roll out of the brand into Mothercare out-of-town stores and some high street outlets.

The acquisition of ELC in June meant the group today reported annual sales of £676.8m (€846m), an increase of 35.8% on a year earlier, with underlying profits 70.8% higher at £38.6m (€48.3m).

Reorganisation costs, mostly relating to the integration of ELC, meant bottom-line profits decreased 76.2% to £4.5m (€5.6m).

Chief executive Ben Gordon said it had been a “transformational year” for the group, with the ELC acquisition a major step in achieving the company’s ambition of becoming the world’s largest specialist parenting group.

He added: “While there is some caution about the consumer environment, we are well placed as we enter the new financial year.”

Mr Gordon said prospects were boosted by international growth opportunities, strong momentum for its online business and the chance to reshape its property portfolio following the addition of ELC.

It has boosted sales per square foot by re-siting some stores, usually through the opening of a smaller shop in the same town, while it has also consolidated Mothercare and ELC into one store where they both exist on the same high street.

Inserting ELC ranges within Mothercare outlets has also enabled the parent company to optimise the use of Mothercare stores.

The entire ELC range is already available online and Mothercare said its focus for the coming year will be to improve the performance of the ELC website.

Its own Mothercare online offering has already proved successful, with sales from its Direct business up 79% to £85.5m (€107m) in the last financial year.

Internationally, Mothercare said franchisee sales were up 42.2%, with underlying like-for-like sales ahead 12%. During the last year, 77 new franchisee stores were opened – 51 Mothercare and 26 ELC – bringing the total to 494 at the end of March.