21 May 2018 - Janet Bird
Ailing baby and maternity retailer Mothercare is to close 50 stores and cut 800 jobs as part of a major restructuring aimed at moving the business to a sounder financial footing.
Details of the rescue plan were revealed as the retailer launched a Company Voluntary Arrangement (CVA) - a type of insolvency that allows businesses to shut loss-making stores, cut rents and reduce costs in a bid to keep afloat and avoid administration.
In addition to store closures and job cuts, the CVA included plans to reinstate Mark Newton-Jones as chief executive, who was ousted by the Mothercare board just a few weeks previously. It also contained a £113.5 million refinancing plan.
Mothercare has been enduring a torrid time of late, with fiscal year end figures for the period up to March 24 showing a £72.8 million pre-tax loss compared to a. £7.1 million profit at the end of the previous 12 months. Total sales were down 1.9 percent at £654.5 million with the retailers performance in the UK particularly hard hit.
Mothercare currently employs around 3,000 people across the UK in 137 stores.