UK: Mothercare to close a further 111 UK stores
By Petah Marian | 12 April 2012
UK retailer Mothercare today (12 April) announced plans to close a further 111 UK stores as it works to restore profitability in its home market.
The company said it will close the stores over the next three years. This follows the shuttering of some 62 stores during the 2012 financial year.
The announcement came as the retailer booked a 6.3% fall in UK sales over the year ended 31 March, declining 6.2% on a like-for-like basis. Worldwide sales increased 4.3%, while group sales were up 0.7% over the year.
Over the fourth-quarter, UK sales declined 9.5%, with like-for-like sales down 8.2%. The declines were blamed on moves to clear excess Christmas stock. Worldwide network sales grew 4.5%, largely driven by 18% growth in international retail sales. Group sales were down 4.2% over the quarter.
The company also revealed plans to reduce central UK costs, improve buying, to accelerate international expansion, and launch online and in-store customer options in the UK and 30 new international websites.
It is also working to "rightsize" its overheads to fit the new smaller UK operating base. It has identified annual savings of at least GBP20m by March 2015. It has also begun consultation to reduce UK head office payroll costs by 16%.
"Today we have announced the framework of our decisive three year strategy to restore the UK business back to profit and strengthen our foundations for growth," said executive chairman Alan Parker.
"This will see us operate a lean, more competitive business, focused on the existing profitable stores in a smaller UK portfolio, combined with a state of the art online platform. Our international business continues to perform strongly and we plan to further accelerate growth."
Sectors: Apparel, Finance, Retail
Companies: Mothercare
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