Mother and baby retailer increases sales but profits dip
Mothercare has pledged to revamp its supply chain as it announced its interim results for the 28 weeks to October 9. Like-for-like sales at the retailer were up 2.4 per cent. Total sales were up 2.5 per cent, from£237 million to£243.2 million. However, profit before tax fell, from£13.4 million to£10.9 million.

Mothercare chief executive Ben Gordon said the results showed that the retailer's turnaround programme was still on track. The retailer's product range has been revamped and the estate is undergoing a refit. He said: 'We have made good progress with our recovery programme and are well pleased with our plans to deliver sustainable growth.'

Following analysis of its logistics operations, Mothercare is about to centralise its supply chain around a UK distribution centre at a newly constructed 300,000 sq ft (27,870 sq m) warehouse. The move to the centre will be completed by mid 2005 and should cost£13 million in construction and revenue costs related to the move. The retailer expects to reduce its distribution costs to 5 per cent of sales over the next 3 to 5 years, down from 6.3 per cent at the moment.

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