Mothercare Grapples with Sales and Profit Decline Amid Restructuring Efforts

Mothercare PLC (MTC), a British heritage international brand, announced its unaudited half-year results for the 26-week period ending September 27, 2025, revealing a decline in worldwide retail sales and adjusted profitability.

The company is pursuing options to rebuild scale and operations, focusing on refinancing existing debt facilities.

Worldwide retail sales by franchise partners decreased by 25% to £90.7 million, compared to £121.2 million in the same period last year. This decline is attributed to store closures in Middle Eastern markets and the planned exit from Boots. Like-for-like retail sales were down 6% year-over-year.

Adjusted EBITDA fell to £0.8 million, down from £1.7 million in H1 FY25. The Group reported an adjusted loss from operations of £0.5 million, a decrease from the £1.1 million profit recorded in the prior year. The adjusted loss before taxation amounted to £1.1 million, compared to a £1.4 million profit in H1 FY25.

Net debt decreased to £5.8 million, a significant improvement from £17.1 million as of September 28, 2024. This reduction in debt provides the company with increased financial flexibility.

Despite the sales and profit decline, Mothercare is making strides in stabilizing its business. The company's partnerships with Reliance in South Asia and Ebebek in Turkey are beginning to yield positive results, highlighting the brand's inherent value and potential.

Driver Breakdown:

• Store Closures: Strategic decisions to exit underperforming markets, particularly in the Middle East, significantly impacted overall sales figures.
• Partnership Growth: New partnerships are showing early promise, providing a foundation for future expansion and revenue generation.
• Debt Reduction: Successful efforts to reduce net debt have strengthened the company's financial position, allowing for greater investment in strategic initiatives.

Clive Whiley, Chairman of Mothercare PLC, commented: “Mothercare is making good progress against our strategic priorities. After the strategic and operational challenges of the last few years, our performance in the first half shows that Mothercare has been stabilised as a smaller and cash generative business with greatly reduced debt.”

The interim results suggest that Mothercare is in a transitional phase, with challenges in sales offset by improvements in financial stability and promising partnerships.