High street baby products retailer Mothercare has laid out ambitions to rebuild its business both in the UK and internationally, despite reporting deepening half-year losses and a significant slump in sales.
Financial Performance and Trading Pressures
The London-listed company, which operates a global franchise model, recorded a pre-tax loss of £1.4 million for the six months to 27 September. This compares to a loss of £1.8 million for the same period the previous year.
Sales generated by its international franchise partners fell sharply by 25% to £90.7 million. On a constant currency basis, the decline was 22%. The company attributed this drop primarily to store closures in the Middle East and the impending conclusion of its exclusive partnership with high street chemist Boots in the UK.
Underlying earnings also took a substantial hit, more than halving to £800,000, down from £1.7 million a year earlier.
Stabilisation and Strategic Refocus
Despite these challenging figures, Chairman Clive Whiley asserted that the business had achieved a state of stabilisation. He credited this to a concerted effort to downscale operations and reduce debt, which now stands at £5.8 million, a significant decrease from £17.1 million in September of last year.
"From this position of relative strength our key focus for 2026 is to pursue options to rebuild our scale and operations both in the UK and globally," Mr Whiley stated. This ambition is set alongside plans to refinance the company's existing debt facilities.
The group confirmed it is actively considering refinancing options after breaching the terms of a key lending agreement, which technically makes a loan with its main lender repayable on demand. However, Mothercare emphasised it continues to have the lender's support and sufficient cash to trade for the foreseeable future.
Ongoing Transformation and Leadership Vacancy
Mothercare's rebuild plan is the latest phase in a multi-year transformation strategy. The chairman noted that recent international ventures, including a £30 million joint venture with Reliance Brands UK for South Asia and a licensing deal with Ebebek for Turkey, are now beginning to deliver results.
A significant piece of the puzzle remains missing, however, as the retailer continues its search for a permanent chief executive. Day-to-day operations are currently being managed by the chief financial officer and the executive team under Mr Whiley's oversight.
"We continue to anticipate the search for a new chief executive officer to be fulfilled as a natural consequence of the multiple strategic discussions currently in train," the chairman commented, indicating that leadership appointments may follow progress on the broader strategic rebuild.
