Sales fell at Mothercare's UK business in the six months before it went into administration

Mothercare has published its unaudited half year results of the company and its subsidiaries for the 28 week period to October 12 2019.

Sales fell at Mothercare's UK business in the six months before it went into administration.

Like-for-like sales at the company's store were down 2 per cent, better than the 11.1 per cent fall registered in the equivalent period in 2018.

Online sales dropped 13 per cent year-on-year, while total sales were down 19.2 per cent.

On November 5 2019, after the period end, the company's subsidiary and owner of the group's UK retail operations, Mothercare UK Limited entered administration.

An agreement was reached with the administrators of MUK to assign the "Mothercare" brand and the majority of the group's international franchise agreements to a new legal entity and subsidiary of the company, Mothercare Global Brand Limited, alongside certain assets and liabilities, including all liabilities in respect of the group's defined benefit pension schemes.

In a statement Mothercare said: "The administration of MUK and transfer of the international franchise business to MGB completes the transformation of our group into a capital light business which is expected to be both cash generative and profitable, focused on its global international franchise arrangements."

The company also announced that Nick Wharton is stepping down as a non-executive director and will be replaced by Brian Small, after a "suitable" handover period.

Mark Newton-Jones, CEO of Mothercare plc, commented: “This has been an extraordinarily challenging period in Mothercare’s 58-year history, particularly for our committed, hard-working colleagues who have worked tirelessly to sustain our UK retail operation. It was simply not financially viable to maintain the UK store estate and supporting infrastructure any longer without putting the whole Mothercare Group at risk.”

“Whilst this was a very difficult decision and one we didn’t take lightly, it completes the transformation of our group into a capital light, cash generative and profitable business and, importantly, protects all of the pensioners of the group.”

“We are confident in the future of the Mothercare brand. We believe that, without the financial and management burden of running a UK retail operation, we can singularly focus Mothercare on its global international franchise.

"This opportunity for this business is best demonstrated by the fact that there are 130 million babies born every year across the world, compared to 700,000 in the UK‎, and the group will now look to drive value for shareholders by harnessing that potential.”

Clive Whiley, Chairman of Mothercare plc, commented:“I would like to thank Nick Wharton, on behalf of the board, for his contribution to Mothercare over the past six years. Personally I would also note his unerring support and wise counsel through the last 18 months since my appointment in April 2018, which has proved invaluable to me, the board and the company.”

“I am delighted that Brian Small is joining the board. Brian brings a wealth of experience from a branded consumer facing background and I have no doubt that he will‎ be an effective non-executive and chair of the Audit and Risk Committee."