Mothercare sales rise after surge in online trade

Retail chain Mothercare offered signs its turnaround is gaining traction after seeing sales rise thanks to a surge in online trade and delayed end-of-season promotion.

The babycare group, which also owns the Early Learning Centre brand, saw a 20.4% jump in online sales in the 13 weeks to October 10, helping overall UK like-for-like sales rise by 6.5%.

Chief executive Mark Newton-Jones said revamp efforts were paying off, but added "there is much more to be done".

Mothercare is in the middle of a £100m turnaround plan which has seen it cut UK stores, curb discounting, refurbish remaining outlets and upgrade its ranges.

The group has also been looking to cut the discounts on offer to boost profit margins, while it delayed its end-of-season sale, usually held in the first quarter.

This gave its international sales a fillip, up 5.6% in the second quarter with currency movements stripped out.

But foreign exchange changes took their toll on reported international sales, down 5.3%.

Mr Newton-Jones said: "Whilst international markets remain volatile, our franchise partners continue to have confidence and have added further space during the period. However, foreign currency continues to be a significant headwind."

Shares in Mothercare rose 6% as analysts cheered a marked recovery in sales at the group, with the second-quarter performance meaning half-year UK sales lifted 3.8% overall.

Matthew Taylor, analyst at Numis Securities, said: "Second-quarter trading delivered the expected rebound in international and further evidence that the UK business is on a firm recovery trajectory."