Mothercare ecommerce up 22 per cent on falling sales

Despite booming ecommerce sales, Mothercare announced group sales of £349.9 million in the half-year to October 10, 6.1 per cent down on the same period last year.

In the UK, sales of £236.6 million were 0.4 per cent up on last time, or 3.8 per cent up on a like-for-like basis, which strips out the effect of store openings and closures.  Pre-tax profits before exceptional charges came in at £7 million, 112.1 per cent up on last time. But after one-off costs of £1.2 million, bottom-line pre-tax profits of £5.8 million were 5.4 per cent up on last time.

Mobile has driven fast growth in ecommerce sales at Mothercare, with visits from customers’ own devices accounting for 56 per cent of online orders and 80 per cent of traffic in the first half of the nursery retailer’s financial year.

Overall, online sales reached £78.1 million in the first half of its financial year, 22.1 per cent up on the same time last year, the retailer reported this week. They now account for 36 per cent of UK retail sales of £78.1 million. That’s up from 29 per cent a year ago. The roll out of iPads to all stores had, said Mothercare, driven in-store online sales growth of 36 per cent: this area of the business now represents 45 per cent of online sales. Just over a third (34 per cent) of online orders are now collected in store, as are 24 per cent of online sales.

The fast digital growth came as the retailer for parents of babies and young children refurbished stores – around 20 per cent will have been upgraded with a more modern look and feel by peak trading.

Chief executive Mark Newton-Jones said that a year into its turnaround, Mothercare was making good progress against its strategy, which had resulted in first-half profits more than doubling. He said, “Our work to return the UK business to profitability continues to pay off,” he said, “with growth in both gross margins and like-for-like sales. Improved product architecture, better buying and a focus on full-price retailing helped drive the stronger margin growth. Our new store format is going down well with customers and these refurbished stores are delivering encouraging uplift in both sales and profit. The UK is annualising against our new trading approach and is performing well, but there is still more work to do.”