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Mothercare Group sales decline 5.2 percent

By Prachi Singh

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Mothercare, for the 15 week period to July 11, 2015 said that overall trading is in line with expectations with the UK making a good start to the year. UK continued to benefit from strategic initiatives with gains in gross margin, online sales growth of 24 percent and like-for-like sales growth of 1.3 percent. International retail sales declined 1.3 percent on constant currency, with currency headwinds further impacting international retail sales in actual currencies which were down 4.8 percent.

Worldwide sales were down 3.5 percent and total Group sales went down 5.2 percent reflecting ongoing store closures in the UK and macro headwinds seen in our international business. Asia and Europe both saw growth in constant currencies with Latin America and the Middle East weaker. The Middle East has been impacted by a reduction in markdown and discount activity and the delay into Q2 of the end-of-season sale which is after Ramadan and Eid.

Elaborating on the results, Mark Newton-Jones, Chief Executive Officer of Mothercare said, “Overall our trading is in line with expectations with the UK making a good start to the year and international seeing some macro volatility as anticipated. Our strategy in the UK is continuing to deliver results. We have delayed the end of season sale to take advantage of well controlled stock and the warm weather to sell more at full price. As a result margins are improving without adversely affecting like-for-like sales. Online has also benefited from lower discounts and promotions with the additional benefit of improved functionality.”

Reconfiguration of UK space continued in line with expectations with space reduced by 5.3 percent year-on-year and a number of newly refurbished stores opened across various locations. The company now operates 180 stores in UK. Internationally, the company is now trading from 1,299 stores.

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