Friday 20 July 2018

Mothercare stores in Ireland 'unaffected' by closures in UK

The closures mean that 900 jobs in the UK are at risk
The closures mean that 900 jobs in the UK are at risk
Ellie Donnelly

Ellie Donnelly

The company that operates the Mothercare brand in Ireland says shops here won't be affected, after the struggling British retailer announced plans to close a further nine stores.

Commenting on the UK store closures Jonathan Ward, MD of Mothercare Ireland said: "Mothercare Ireland is a completely separate company and as a result our 15 Irish stores are unaffected by any plans in the proposal and will continue to trade as normal."

The latest UK store closures, which will result in the loss of around 100 jobs, mean a total of 60 Mothercare stores in the UK will now be shut by June next year, putting 900 jobs in the UK at risk.

The changes come after Mothercare UK cleared a restructuring plan known as a Company Voluntary Agreement (CVA), an insolvency procedure that required the approval of the retailer's landlords.

The group has also undertaken a significant fundraising initiative to raise £32.5m from its existing shareholders.

Mothercare has identified savings of £19m through the process, and hopes to realise £10m in cash.

Clive Whiley, Mothercare's interim executive chairman, said: "When I joined the business just three months ago, Mothercare UK faced a bleak future with growing and pressing financial stresses upon the business.

"We have worked tirelessly as a team to get to where we are today and this fully underwritten equity issue marks the end of this initial phase, returning the group to financial stability."

In Ireland a separate business has the right to trade under the Mothercare brand.

Mothercare Ireland is a separately owned and family-run business, started by David Ward in 1992 and is now run by his two sons, Jonathan and Ben, and daughter Laura.

Mothercare Ireland is one of the original partners of the Mothercare International Group, and is currently the fifth-largest partner in the world.

The Irish business exited an examinership in October 2015 that resulted in three stores being closed at Blackrock and Jervis Street in Dublin and Cruises Street in Limerick and significant rental reductions being achieved.

Earlier this year, the directors of the Irish business said it had achieved a significant turnaround last year.

That was after new accounts for Mothercare Ireland show that the company recorded pre-tax profits of €488,711 in the 12 months to March 26, 2017 last.

In May this year, Mothercare UK unveiled a brutal set of annual results, swinging to a £72.8m pre-tax loss in the year to March 24, which compares with a £7.1m profit in 2017.

The store closures come at a dismal time for the UK main street.

Since January, Toys R Us and Maplin have filed for administration, while fashion retailers such as New Look, Carpetright and others have embarked on radical store closure programmes.

(Additional reporting from PA)

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