Maternity specialist Mothercare aims to double its international sales by 2014 as its UK business continues to find the going tough.
The retailer told analysts on a company visit to India last week it was ramping up its international expansion and planned to open 150 new overseas stores every year from 2011. Overseas network sales are forecast to top £1bn by 2014.
Mothercare has already upped international store openings in the current financial year from 150 to 175. The retailer has also increased its international margin gains target to between 20 and 30 basis points compared with a rise of between 10 and 20 previously expected. International sales are now expected to exceed UK sales for the first time this year.
India’s GDP growth and high birth rate make it a prime location for Mothercare’s expansion. By March 2011 the retailer will have 70 stores in the country. It also highlighted Russia, China, Australia and the Middle East as key markets.
Singer analyst Matthew McEachran said Mothercare was “one of the UK’s most exciting international retail growth stories”.
He maintained: “Given the highly profitable and cash generative nature of the franchising model, and given a well developed and scalable global supply chain, the new overseas expansion plans bode well for future earnings growth.”
Mothercare’s UK business continues to struggle. Singer downgraded current year profit forecasts in the UK by £1m.