Mothercare’s fresh chief executive David Wood is poised to expose the troubles it faces amid its annual results next Thursday.
Analysts are expecting the embattled retailer to post a massive 95 per cent drop in pre-tax profits to £1 million, down from £19.7 million a year earlier.
Woods, who was drafted to succeed Mark Newton-Jones after he was forced out last month, is expected to update shareholders and creditors on its refinancing progress.
Sources told the Retail Gazette that the board was not happy with the progress Newton-Jones was making in its turnaround.
Just weeks later, non-executive chairman Alan Parker jumped ship from Mothercare, with Clive Whiley filling his shoes on an interim basis.
It has enlisted the help of KPMG to help it secure more funding from its lenders HSBC and Barclays, as well as Rothschild to secure further funding from other sources.
Although it has not yet confirmed its emergency turnaround strategy, it is understood that a CVA is the most likely option, which could see it close up to a third of its estate and secure rent reductions on dozens more.
“Mothercare clearly faces a number of challenges at this time but retains an excellent and still relevant brand in our view,” Shore Capital’s Clive Black said.
“The new senior management team is now focused upon the previously announced refinancing initiatives whilst also seeing through the ongoing business transformation.”
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New CEO arrives, books lots of dodgy provisions, profits appear to collapse, after a year of tenure reverses provisions, profits appear to recover, he must be a genius give him a huge bonus, etc etc
As a retailing Executive Director with fifty years of experience and major fan and previous shareholder of Mothercare, I am not at all surprised by their demise. They NEVER have the right items in stock at the right time and their staff although willing, really don’t know enough to be able to boost sales to customers at ground-level to make the all-important difference to their profits. With new grandson arrived, I tried THREE times in the past three months to buy from Mothercare. First, it was a Car Seat, which I bought from Halfords, because they had it in stock and it was £20 cheaper. Second was a Stairgate, where Mothercare had none in stock, so it was purchased from Tesco’s. Finally, a simple “pelican” bib was needed and again, they had tons of stock, but ALL the wrong stuff. Change the Buyers, I say, and micro-manage the Stores and train the staff properly. Doesn’t ANYONE know ow to run a Retail Store any more ?