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Baby goods retailer Mothercare (MTC) has reported a 6.5% rise in second quarter UK like for like sales thanks to a big boost in online revenues.
Online sales grew by 20.4% during the period, while Mothercare said it had seen a further growth in UK margins as it sold a high proportion of its products at full price.
Total UK sales were up 1.8% in the quarter, but overall group revenues were down by 7.1% reflecting the shrinking of its store estate and the impact of currencies on its international business (which was up 6.6% like for like but down 5.3% at actual rates).
In the UK it closed ten stores and opened three in the quarter, leaving it with 173 UK stores. It will also refurbish 20% if UK stores before Christmas.
Mark Newton-Jones, CEO of Mothercare, said: “The second quarter results are in line with our full year expectations. The UK is continuing to benefit from our strategic initiatives both online and in store, while International has seen the expected improvement in trading.”
“These results give us further confidence in our strategy, but there is much more to be done. Our vision remains clear - to be the leading global retailer for parents and young children.”
Morning update
A quiet morning for the grocery sector is a far busier one for the wider retail industry.
Notably Debenhams has made the shock announcement its CEO Michael Sharp is to step down after five years at the helm. He will remain in his post during the Christmas trading period and into 2016 to assist with the handover to his successor and help the board find his replacement.
Separately, Debenhams reported that full year pre tax profit rose 7.3% to £113.5m and annual like for like sales were up 2.1%.
Elsewhere, there are trading updates from Travis Perkins and Inchcape, while to official ONS Retail Sales for September are out later this morning.
The FTSE 100 has opened almost flat this morning, edging down to 6,343.7pts. Most grocery stocks are slightly up, but there are no dramatic movements to speak of.
Mothercare has jumped 3.6% to 231p on this morning’s news, while Debenhams is 4% up to 84.4p.
Yesterday in the City
The FTSE 100 closed just 3.3 points higher yesterday to 6,348.4pts despite the plunging share price of education giant and former Financial Times owner Pearson.
Reckitt Benckiser (RB) was one of the day’s stand-out performers, rising 2.5% to 6,300 after growing third quarter like for like sales by 7% and beating raising its full year sales expectations.
In the US, Coca-Cola (KO) shares dipped by 0.2% to $42.19 after revenues fell 5% in the third quarter and net income dropped by 31.3% as the strong dollar hit trading.
Elsewhere, Ocado (OCDO) leapt 3.3% to 349.7p after investment vehicle London & Amsterdam upped its stake in the online retailer from 12% to more than 13%.
Other strong performers including Associated British Foods (ABF), up 1.3% to 3,361p, Booker (BOK), up 2.2% to 185p and McColl’s Retail Group (MCLS), up 3.3% to 150p.
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