Mothercare reports positive sales

Retailer Mothercare today reported a positive sales performance in the first quarter of its financial year.

The company said total group sales ahead 20.7% in the 15 weeks to July 11 following last year’s acquisition of Early Learning Centre.

Sales from the company’s Direct in Home online and catalogue business were ahead 77.7%, or 27.5% when the impact of ELC is smoothed out.

In a statement ahead of the company’s annual meeting, chairman Ian Peacock said he was pleased with the first quarter performance.

He added: “The multi-channel business has shown resilience in a slow economic environment, strengthened by the successful Direct operations.”

Mothercare bought Early Learning Centre for £85m (€107m) and has since been working on a plan to optimise the company’s property portfolio. Inserting ELC ranges within Mothercare outlets has also enabled the parent company to optimise the use of Mothercare stores.

The jump in sales for the Direct operation comes after Mothercare pledged to improve the performance of the ELC website.

The company has also entered the Chinese market for the first time through a joint venture with the country’s largest manufacturer of childcare products, Goodbaby. International franchise like-for-like sales were up by 9% in the first quarter, Mothercare added.

The company has revived its fortunes in the past three years, following an overhaul of its UK high street operations.

The acquisition of ELC meant the group reported annual sales in May of £676.8m (€854m), an increase of 35.8% on a year earlier, with underlying profits 70.8% higher at £38.6m (€48.6m).

Reorganisation costs, mostly relating to the integration of ELC, meant bottom-line profits decreased 76.2% to £4.5m (€5.7m).

Mothercare has 11 outlets in Ireland.