Mothercare aims to woo shoppers with more exclusive products and finance director Matt Smith has ruled himself out from the race to become chief executive.
Smith said that Mothercare is working with suppliers to secure more exclusive ranges to combat a “highly promotional and competitive” market place, which he expects to continue in the year ahead. Mothercare is also adding more own-brand to help it navigate a price war in the maternity goods sector.
Smith said: “We’re not chasing loss-making sales.”
Mothercare, which parted company with chief executive Simon Calver in February, is searching for a replacement. However Smith said he had not thrown his hat into the ring. “I’m too attached to my calculator,” he said.
Mothercare appointed former Shop Direct boss Mark Newton-Jones as interim chief executive. Smith said that Newton-Jones had focused on business operations in his first few weeks at the helm.
Mothercare’s UK like-for-likes were flat in the fourth quarter, an improvement on its third. Smith said it had a good mid-season Sale but he was still cautious about the UK business. “We’re in a turnaround. There will be ups and downs,” he said.
Although Mothercare’s international sales rose 9.8% at constant currencies, it dipped 1.8% at moving currencies.
Smith said that devaluation of currencies in some of its largest markets including Russia, Indonesia and Turkey were behind the drop and he expected that to continue into the new financial year.
Smith said the “fundamental health” of Mothercare’s international business was fine and he was heartened by its franchise partners’ commitment to double-digit space growth.
Mothercare’s online sales were up 1.8%. Smith said the rise was small because of increased Sale activity online during the same period last year. He pointed out that ecommerce now accounts for 29% of Mothercare’s sales and a third of online sales now comes through the click-and-collect service that it rolled out last year.
He said mobile was the star performer and is an important sales tool for mothers. He pointed out that 42% of Mothercare’s traffic now comes from mobile devices.
Despite Calver’s departure, Smith said the turnaround plan continued tp prgress. “Driving down cost, closing stores and growing overseas are the right thing to do,” he maintained.