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Mothercare looks abroad for growth
BABYCARE retailer Mothercare today said strong growth overseas would offset a "more challenging" consumer climate in the UK this year.
The company hailed a record year for its international arm after sales jumped 21 per cent to 490.9 million, helped by the launch of Mothercare in Australia and the Early Learning Centre in South Africa.
Mothercare - which now has 1,115 stores in 52 countries - saw its fourth successive year of like-for-like sales growth in the UK but is "planning cautiously" for more sluggish conditions as shoppers feel the squeeze.
Underlying annual profits for the year to March 31 rose 17 per cent to 52 million, in line with City forecasts.
Mothercare is driving its overseas operations through franchising, which allows it to profit from royalties on international sales for the use of its brands without heavy capital investment.
The group is targeting India and China as key growth markets after forming joint ventures with local partners. Mothercare expects to have 70 stores in India open by the end of the current year, with a medium-term target of 200.
In the UK - where Mothercare's Spin pushchair has proved a best-seller along with the ELC's Retro Robot - the firm is shifting away from lower-profit town centre stores towards more out-of-town parenting centres in key areas, planning 120 of the new outlets.
The group is also ahead of schedule on plans to close stores or renegotiate leases on under-performing shops and expects a bigger than previously guided 16.1 million annual gain from its property strategy by the end of 2012.
While sluggish conditions are likely to linger on the high street, Mothercare has also identified its wholesaling business as a key area of growth and has signed a deal with retailer Boots to supply childrenswear to around 400 stores from September.
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Saturday 11 February 2012
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