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Mothercare suffers UK sales fall and buys Blooming Marvellous brand

Maternity specialist Mothercare has posted a fall in UK sales and has bought the trademark and brand of privately owned rival Blooming Marvellous.

Mothercare’s UK sales slid 2.6% in the first quarter to July 10 and 4.1% on a like-for-like basis. The retailer will invest margin to maintain its appeal.

International retail sales climbed 20.3% however, and multichannel turnover was up 13.7%. Group sales were 0.4% ahead.

Chairman Ian Peacock said Mothercare’s strategy of international expansion and property restructuring in the UK was delivering results and that the business was well placed.

He said: “In the UK we continue to plan cautiously for the remainder of this year. In this context, we expect to invest further margin in our customer offer which will be offset, in part, by cost savings and our property restructure.”

KBC Peel Hunt analyst John Stevenson expected City forecasts to be moved down as a result of the margin investment. He said: “Management is minded to sharpen process for a more competitive peak Christmas trading period, particularly with respect to toys, and expects full-year margin to fall by 100 basis points.” The previous expectation was that margin would be flat.

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