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Mothercare UK sales improve in first quarter

Mothercare UK sales edged up in the first quarter, but the baby products retailer experienced challenges in the Middle East.

Core UK like-for-like sales grew by 1.9 per cent in the 15 weeks to July 8 and online sales rose 3.3 per cent. However total sales were down reflecting the effects of the brand’s store closure program. Mothercare ended the quarter with 147 stores in the UK and total floor area down to 1.4 million sqft.

International retail sales were down 8.3 per cent in constant currency and up 2.2 per cent in actual currency, primarily driven by continued weakness in the Middle East. International online sales grew 53 per cent in constant currency and 78 per cent in actual currency.

Mothercare opened 26 stores and closed 43 abroad during the period, mainly driven by market exits. The company now supplies 1133 stores outside the UK.

CEO Mark Newton-Jones said the company was continuing to make progress on its restructure.

“We have seen customers respond well to our end of season sale, which we entered with less stock than last year, and are achieving a higher sell-through rate. Whilst online sales recorded a lower growth, in contrast to higher sales growth in store, we don’t believe this represents an underlying permanent shift in customer behaviour. We are about to launch our autumn ranges, but it remains uncertain how [UK] consumers will respond to inflation.”

Newton-Jones said the challenging economic conditions in the Middle East continued to impact on its international business. “So the outlook remains volatile. We continue to export our learnings from the UK as our business improves here, to support our partners with the modernisation of their franchise businesses, and see further opportunities for growth both online and in stores.”

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