Mothercare to swing axe on 50 stores and bring back sacked boss

Mothercare stores closing

Mothercare stores closing

The company also confirmed Mark Newton-Jones is returning as Chief Executive Officer and that the current CEO David Wood has been named the Group Managing Director.

The Dublin-based retailer has been quick to distance itself from its troubled namesake after Mothercare UK, which has already nearly halved the number of stores it has in the past five years, said that its financial outlook was "perilous" and that it will be closing another 50 stores in Britain, and putting 800 jobs at risk.

The plans came as the company reported a £72.8m pre-tax loss for the year to 24 March, compared to a £7.1m profit a year before - dragged into the red by costs such as restructuring, store closures and writedowns in the value of parts of the business.

Mothercare now trades from 137 United Kingdom stores, having had almost 400 a decade ago.

Over the past year Mothercare's shares have sunk by 83 percent.

"Clive Whiley, the company's interim executive chairman, said: "‎The recent financial performance of the business, impacted in particular by a large number of legacy loss making stores within the United Kingdom estate, has resulted in an unsustainable situation for the Mothercare brand, meaning the group was in clear need of an appropriate resolution. The new plan would see it trade from 73 United Kingdom stores by 2022.

The company announced this morning it also plans to seek rent reductions on 21 of its stores as it tries to secure "a viable and sustainable future".

Already this year Toys R Us UK, electricals group Maplin and drinks wholesaler Conviviality have moved into administration, while fashion retailer New Look and floor coverings retailer Carpetright are closing stores.

Creditor meetings to vote on the CVA proposals are expected to be held on June 1, with the process expected to complete in July.

"The business was in an unsustainable situation and was in clear need of an appropriate resolution and today's comprehensive measures provide a renewed and stable financial structure for the business, and will allow Mothercare to accelerate its adaptation to the shifting dynamic towards online".

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