Mothercare predicts "brighter and more stable future" after recovery from £97m loss
A global parenting brand has predicted a “stable future” as it bounces back from a nearly £100m loss.
Mothercare, based in Watford, achieved profits of £14.4m in the year to 28 March 2020, up from a £97m loss in the previous period.
This comes amid a year of change for the brand, which included going into administration in November and moving to a smaller HQ.
In closing all retail outlet stores and focusing on franchise partners, the company estimates that it has eliminated approximately £30m of operating losses.
However, since the year end, Mothercare has seen retail sales drop 39 per cent to £145.8m as lockdown hit its franchises around the world.
Clive Whiley, chairman of Mothercare, commented: “We have diligently managed our way through to mitigate the impact of the Covid-19 pandemic during this period of global crisis, and we emerge in better shape than we went into it.
“We continue to reduce costs and improve our efficiency. We are excited to launch our new UK and Ireland franchise with Boots, restoring the Mothercare brand to its home territory.
“We have entered into a new 20 year franchise agreement with Alshaya, our largest partner.
“We have successfully rolled out our innovative, working capital light arrangements with our manufacturing and franchise partners.
“We are now singularly focused upon building Mothercare as a global brand, both in our existing territories and beyond.
“We are confident with these foundations now in place Mothercare can move forward as a profitable and cash generative international franchise business, generating revenues through an asset-light model in some 40 international territories.
“This would not have been possible without the support of all of our stakeholders whom, on behalf of the board, I would like to thank for enabling us to get to this point.
“As a result, from today, Mothercare can look forward to a brighter and more stable future once more.”
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