Mothercare’s UK operations are to be put into administration, putting 79 stores at risk of closure.
The retailer is filing notices of intent to appoint administrators today. The subsidiaries affected are Mothercare UK Limited and Mothercare Business Services Limited. The rest of the business, which also operates through franchising agreements, will not be affected.
Mothercare said that in the year ending March 2019, the brand generated profits of £28.3m internationally, but the UK retail business lost £36.3m.
The company said: “Since May 2018, we have undertaken a root-and-branch review of the group and Mothercare UK within it, including a number of discussions over the summer with potential partners regarding our UK retail business.
“Through this process, it has become clear that the UK retail operations of the group, which today includes 79 stores, are not capable of returning to a level of structural profitability and returns that are sustainable for the group as it currently stands and/or attractive enough for a third party partner to operate on an arm’s length basis.
“Furthermore, the company is unable to continue to satisfy the ongoing cash needs of Mothercare UK.
“These notices of intent to appoint administrators in respect of Mothercare UK and MBS are a necessary step in the restructuring and refinancing of the group. Plans are well advanced and being finalised for execution imminently.”
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