In its pre-close trading statement, Mothercare announced that it managed to stay “marginally” profitable despite a decrease in retail sales.
The nursery retailer stated that its adjusted EBITDA for the year ending 30 March was slightly higher than the £6.7 million from the previous year, meeting market expectations.
According to draft figures, net worldwide retail sales by franchise partners totaled £281 million for the period, representing a 13% decrease from the previous year.
Mothercare attributed this decline in sales to challenging market conditions in the Middle East, which makes up 41% of its total retail sales, while retail sales in the UK saw an increase compared to the previous year.
Although the company reported net debt of £14.7 million, it highlighted that the rise in EBITDA indicated an improvement in the underlying profitability of the business.
Mothercare’s chairman, Clive Whiley, stated: “Given the external factors affecting some of our operating markets, our immediate focus is on supporting our franchise partners, which will ultimately benefit our own business. We are also intensifying our efforts to rebuild our customer base and are committed to leveraging the global brand IP of Mothercare.
“This presents an exciting opportunity for our partners, our employees, and all stakeholders.”
In a recent incident, Poundland had to take down its ‘Motherland’ signs from a new store after Mothercare objected, claiming the similarity in branding and issuing a cease and desist order.
Poundland had opened a flagship store in Biggleswade, Bedfordshire, named ‘Motherland’ due to its extensive collection of baby and children’s clothing. However, Mothercare intervened due to brand similarity concerns.
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