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17:14 GMT, Thursday, 20 November 2008

Mothercare sees its profit double

Mothercare ELC store

Baby goods retailer Mothercare said it was well-placed for Christmas as strong growth in its international and online business helped boost profits.

The group's pre-tax profits for the six months to September doubled to £9.5m compared with same period last year.

Chief executive Ben Gordon said that the UK "outlook remained uncertain".

His comments came as UK retailers cut prices ahead of Christmas to try to tempt shoppers - as consumers cutback on spending in the face of recession.

Despite the tough conditions, the retailer managed to grow its UK like-for-like sales - which strip out the impact of new stores - by 0.8% during the six months.

"It's clearly tough out there. We don't know what's going to happen between now and Christmas," Mr Gordon told BBC News.

Expansion plans

However, outside the UK prospects looked much better, with international sales up 9%.

"Only 0.5% of the world's babies are born in in the UK, that's 99.5% outside the UK," Mr Gordon said.

The Middle East, Eastern Europe and Russia were among the company's best-performing markets.

Mothercare currently has 24 stores in and around Moscow and plans to open another 40 stores in the next three years.

It has outlined expansion plans for China and India too.

Mr Gordon also said he had seen an "extraordinary change in customer behaviour" as more of its customers were buying online.

"It's the vision of the future, increasingly people are shopping on the net both at home and in store," he added.

Mothercare expects to see cost savings of £10m from next year as a result of combining some of its the Early Learning Centre stores, which it acquired a year ago, and reducing shop space and rents.




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Related to this story:
Retail sales bring scant comfort (20 Nov 08 |  Business )
M&S resorts to one-day sale move (19 Nov 08 |  Business )
Mothercare's profits fall by 76% (22 May 08 |  Business )


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