Mothercare Faces Decline in Sales Amid Strategic Reassessments

Published
September 25, 2025

Mothercare, the well-known brand specializing in mother-and-baby products, has reported a significant decline in its full-year results, revealing a challenging landscape for the company. The latest figures indicate that worldwide retail sales through franchise partners plummeted to £230.6 million, down from £280.8 million the previous year. This decline raises questions about the brand’s future and its ability to adapt to a rapidly changing retail environment.

Financial Overview

The company’s adjusted EBITDA also saw a downturn, dropping to £3.5 million from £6.9 million. However, there was a silver lining: net borrowings decreased to £3.7 million from £14.7 million at the end of the previous fiscal year. This reduction in debt may provide some financial breathing room as the company navigates its current challenges.

It is important to note that the fiscal year 2025 results, covering the 12 months ending in March, were based on 52 weeks, while the previous year’s figures included an additional week of trading. Despite this discrepancy, the stark contrast in sales and profit figures cannot be solely attributed to the fewer trading days.

Declining Sales and Store Numbers

Mothercare has faced numerous challenges in recent years, leading to a sharp decline in the number of stores. The group’s adjusted operating profit fell by a staggering 69%, landing at £2 million, while the adjusted loss after tax was reported at £2.5 million, a significant drop from the £3.5 million profit recorded the previous year. Interestingly, the statutory profit rose by 88% to £6.2 million, indicating a complex financial landscape.

For franchise partners, the situation is even more dire. Worldwide retail sales fell by 18%, with online sales down 24% to £21.8 million. The total number of stores has decreased by 19%, now standing at 372. This decline reflects broader trends in the retail sector, where many traditional brick-and-mortar stores are struggling to compete with online shopping.

Ongoing Challenges

The company has indicated that the first half of fiscal year 2026 has not shown signs of recovery, with franchise partners’ total retail sales dropping to £80.7 million from £107.7 million during the same period last year. The ongoing decline has been attributed to “the continuing uncertainty in the Middle East” and a winding down of sales arrangements in the UK, particularly with Boots, a major retail partner. This reduction in retail sales is expected to lead to significantly lower profitability for the group.

Strategic Reassessments

In light of these challenges, Mothercare is reassessing its business model. The company stated that its global brand is now “significantly bigger than our current business is able to extract the full value from.” The creation of a joint venture in India has improved the company’s balance sheet and financing position, but Mothercare is now focused on achieving a “step change” in its operations and brand presence.

Chairman Clive Whiley emphasized the need to restore critical mass, particularly in the UK market. He stated, “We are accelerating discussions with several parties to monetize the operational gearing in the business.” This strategy aims to bolster the efforts of the management team to enhance the product offering and drive growth.

Historical Context

Mothercare has a long history, having been established in 1961. The brand has undergone various transformations over the decades, adapting to changing consumer preferences and market dynamics. However, the current retail landscape poses unprecedented challenges, with many established brands struggling to maintain relevance in an increasingly digital world.

The decline in physical store sales is not unique to Mothercare; many retailers have faced similar fates as consumer behavior shifts toward online shopping. The COVID-19 pandemic accelerated this trend, forcing many companies to rethink their strategies and embrace e-commerce.

Future Prospects

As Mothercare navigates these turbulent waters, the focus will be on leveraging its brand strength and exploring new partnerships. The company is in discussions with various parties to restore its market presence and drive sales growth. The management team is optimistic that by capitalizing on the inherent strength of the Mothercare brand, they can return to a growth trajectory.

The retail sector is known for its volatility, and Mothercare’s situation serves as a reminder of the challenges faced by traditional retailers. The company’s ability to adapt and innovate will be crucial in determining its future success.

Conclusion

Mothercare’s recent financial results highlight the significant challenges facing the brand as it grapples with declining sales and store numbers. While the company has made strides in reducing debt, the ongoing decline in retail sales raises concerns about its profitability and market position. As Mothercare embarks on a strategic reassessment, the focus will be on restoring critical mass and leveraging its brand strength to navigate the evolving retail landscape. The coming months will be pivotal for the company as it seeks to regain its footing in a competitive market.