Mothercare

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Mothercare plc
Public company (LSEMTC)
IndustryRetail
FateAdministration
PredecessorStorehouse plc
Founded1961; 58 years ago (1961)
DefunctDecember 2019; 8 days' time (December 2019)
HeadquartersCherry Tree Road, Watford, Hertfordshire
Number of locations
Decrease 79 stores
Key people
Clive Whiley (chairman)
ProductsBaby products
Revenue£667 million (2017)[1]
£10.4 million (2017)[1]
£8.2 million (2017)[1]
Number of employees
Decrease 5,852 (2012–2019)
ParentMothercare UK limited
Divisionsmothercare.com
SubsidiariesEarly Learning Centre
Websitewww.mothercare.com

Mothercare plc is a British retailer which specialises in products for expectant mothers and in general merchandise for children up to 8 years old. It is listed on the London Stock Exchange, and is a constituent of the FTSE SmallCap Index. As of November 2019 the UK retail arm of the company along with its associated business services division is in administration and is set to shut down its remaining 79 stores affecting thousands of staff members.[2] The parent company is unaffected.

Mothercare in the Woolshops shopping centre, Halifax, West Yorkshire.
Child seats on shopping trolleys cast their shadows on the front of the Mothercare at Wren Park, Torquay

History[edit]

The company was founded by Selim Zilkha and Sir James Goldsmith in 1961.[3] It was first listed on the London Stock Exchange in 1972.[3]

In 1982, it merged with Habitat[3] to form Habitat Mothercare plc. In 1986, Habitat Mothercare plc merged with British Home Stores, to form Storehouse plc.[3] In January 1996, it bought Children's World from Boots,[4] and rebranded all of their superstores Mothercare World stores. In May 2000, the Bhs stores were sold to Philip Green,[4] and Storehouse reverted to the Mothercare brand.[4]

In June 2007, Mothercare bought the Early Learning Centre (ELC) for £85 million.[5] In October 2007, Mothercare launched Gurgle, a pregnancy and parenting social networking website.[6] In November 2009, Mothercare acquired the 50% of Gurgle that it did not already own.[7]

In July 2010, Mothercare bought the trademark and brand of privately owned rival Blooming Marvellous.[8] In May 2011, it was reported that Mothercare was set to undergo a major restructure in their retail sector, resulting in an undisclosed number ELC stores moving into neighbouring Mothercare stores to lower costs.

In May 2018, it was confirmed that Mothercare would close fifty stores in the United Kingdom in an attempt to halt its perilous "financial position".[citation needed]

In July 2019, the company said it’s planning to spin off its UK retail business due to decreased sales. The company reported that the UK store sales fell down by 23.2%, while online sales in the UK were down by 12.1%. The company recorded a worldwide sales drop of 9.4%.[9]

Operations[edit]

The company operates online, on the High Street and out of town, and in November 2009, had over 1,060 stores worldwide of which 389 were in the United Kingdom, and 671 were abroad in 38 other countries.[10]

By 2017, Mothercare operated over 1,302 stores worldwide, with 152 stores in the United Kingdom. Following a UK company voluntary arrangement in 2018, Mothercare agreed to close 60 stores. As at January 2019, Mothercare announce that its closure programme was ahead of schedule and the group was on course to have 79 shops by the end of March 2019. Mothercare has ceased trading in the UK by closing all remaining stores and going into administration on 11 August 2019. [11]

Financials[edit]

In September 2014, Mothercare did a nine for ten rights issue issued at 125p per share, a discount of 34.2 per cent to the then current share price to raise £95m net of expenses. Mothercare said it would be used to pay off £40 million in loans.[12] By March 2018, Mothercare were in talks with the banks to waive their covenants, causing the Mothercare share price to fall by one third to 22 pence per share. Mothercare has a pension shortfall of £80m.[13]

UK Administration[edit]

On 4 November 2019, Mothercare announced it was appointing administrators for their UK operations of 79 stores, placing 2,500 jobs at risk. Mothercare, which suffered a loss of £36.3m during 2018-19, stated the decision came after a review made clear that the business would not return to profitability.[14] On 5 November, it was announced by the administrators that there would be a phased closure of all UK stores. [15]

Internationally[edit]

Ukraine[edit]

In Ukraine, the Mothercare brand is represented by MBGroup LLC. Ukrainian Mothercare stores are the same as their European counterparts, with British representatives carefully monitoring the quality of the stores and their staff. The flagship store was opened in August 2004, in Kiev's premier shopping mall "Globus".

It is the largest Mothercare store in Ukraine, both in terms of size and range of products. After rapid expansion, the Mothercare brand is represented in Ukraine by over twenty stores in Kiev, and several additional stores in Lviv, Dnipropetrovsk, Kharkiv, Odessa, Donetsk, Vinnytsia and Zaporizhya.

Kuwait[edit]

In 1983, M.H. Alshaya Co. began its first franchise operation with the Mothercare brand in Kuwait, which was also its first international store. Alshaya operates Mothercare franchises[16] in the Middle East, North Africa, central and eastern Europe and Russia.[17]

Singapore, Malaysia and Hong Kong[edit]

In Singapore, the Mothercare brand is represented by Kim Hin International Pte. Ltd. which began in 1984[18] by its founder and current chairman, Pang Kim Hin.[19] Subsequently, the company expanded to include their Malaysian subsidiary Kim Hin Joo (Malaysia) Sdn. Bhd. in 1987 and Mother and Child Limited Hong Kong in 1992. The flagship store for Mothercare Malaysia is located at Suria KLCC.

Brunei Darussalam[edit]

In Brunei, Mothercare is owned by the Growtech Marketing Group, and has been operating since 1996. There are currently three stores in Brunei, two situated at the Brunei-Muara District and one at the Kuala Belait District. Mothercare Brunei's flagship store is located at Kiulap.

Pakistan[edit]

In Pakistan, Team A Ventures Pvt. Ltd. is the official franchisee of mothercare UK. It was founded in 2004[20] with the aim to help establish the presence of international brands like mothercare. The company opened its first franchise for mothercare in 2004 and now has 12 stores in the top metropolitan cities of Pakistan[21].

Karachi - Dolmen Mall, Clifton | Dolmen Mall, Tariq Road

Lahore - Packages Mall

Islamabad - The Centaurus Mall, Safa Gold Mall

Rawalpindi - Giga Mall

Multan - Mall of Multan

Gujranwala - Kings Mall

Faisalabad - Saira Mall

References[edit]

  1. ^ a b c "Annual Report 2017" (PDF). Mothercare. Retrieved 25 April 2011.
  2. ^ http://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/MTC/14295558.html
  3. ^ a b c d Mothercare Chief Executive ousted after fourth profits warning in under a year
  4. ^ a b c UK Business Park:Storehouse Archived 17 May 2014 at the Wayback Machine
  5. ^ "Mothercare to buy Early Learning Centre" Archived 17 July 2012 at Archive.today, Reuters, 30 April 2007
  6. ^ Mothercare pre-tax profits increase tenfold, back from the brink Baby Chums, 22 May 2009.
  7. ^ Mothercare buys remaining 50% of Gurgle.com. Retail Week, 18 September 2009
  8. ^ Mothercare buys up rival Blooming Marvellous. Daily Mail, 15 July 2010
  9. ^ "Mothercare considers UK spinoff as sales slump". Retrieved 26 July 2019.
  10. ^ "Overseas sales boost Mothercare", BBC News, 16 November 2006
  11. ^ "Subscribe to read". Financial Times. Retrieved 12 January 2019.
  12. ^ "Why Mothercare Plc going BUST Faster than YOU Think". 21 March 2018.
  13. ^ Wood, Zoe (2 March 2018). "Mothercare in rescue talks with banks as UK retail crisis spreads". The Guardian.
  14. ^ Kollewe, Julia (4 November 2019). "Mothercare to appoint administrators for UK chain, putting 2,500 jobs at risk". The Guardian. London. Retrieved 4 November 2019.
  15. ^ Template:Cite news date=5 November 2019
  16. ^ "Discover the Brands we Franchise".
  17. ^ "Mothercare Dubai | Baby Products & Maternity Clothes".
  18. ^ "About Mothercare".
  19. ^ "About Mothercare".
  20. ^ tav. "History of TAV Team a Ventures". Team A Ventures. Retrieved 30 August 2019.
  21. ^ "Baby Shop Online: Baby Products Shopping In Pakistan". www.mothercare.pk. Retrieved 30 August 2019.

External links[edit]