Mothercare Sees Shares Up Despite Sales Fall
Shares in Mothercare have risen sharply despite the chain announcing another year of falling sales in the UK.
Underlying profits came in at £9.5m but when restructuring costs of its struggling UK business are included, the firm posted a group-wide pre-tax loss of £26.3m for the year to the end of March.
Like-for-like sales in the UK were down almost 2% - but shares rose by 18%.
Investors responded positively as the drop in UK sales went from the 3.6% fall seen in the previous period. And creditors gave the business more headroom on its borrowing.
Web sales grew with click-and-collect representing a third of online orders, and mobile devices accounting for 35% of internet traffic.
Chairman Alan Parker said he looked forward to sustaining improvement in the new financial year.
He said: "Underlying group profits are up on last year, but there is a lot more to do."
Mr Parker also said the search for a new chief executive was "progressing well", following the resignation of Simon Calver in February, six weeks after the company issued a profits warning due to poor Christmas trading in the UK.
During the year, Mothercare closed 35 loss-making stores in the country. They were seven Mothercare outlets and 28 Early Learning Centres.
Mr Parker said: "We are determined to achieve our goal of returning the UK to profitability, growing our international business and building shareholder value over the long term."
The group has 358 stores in 45 countries, mainly in Europe.
The business outside the UK is doing well with worldwide sales worth £1.2bn.