14th May 2018 10:01
LONDON (Alliance News) - Mothercare PLC said Monday it was finalising a restructuring and refinancing package which it intends to announce with its final results on Thursday.
The parent and baby product retailer made the statement after media reports over the weekend suggested it would be looking it unveil plans to enter a company voluntary arrangement. The Daily Telegraph said on Saturday that entering a CVA insolvency would allow Mothercare to shutter some of its 1,300 stores and drive down rents.
On Monday, Mothercare said it was finalising a "comprehensive restructuring and refinancing package to put the business on a stable and sustainable financial footing". The firm added it was in the final stages of detailing this plan. It didn't specifically address the report of entering a CVA in its statement Monday.
Mothercare said it was also looking to enter into new committed debt facilities, an underwritten equity issue, and gain access to other sources of capital alongside the restructuring.
Details of these moves will be provided with its final results due on Thursday, it said.
In mid April, Mothercare reported reduced UK footfall led to declining total sales in its fourth quarter, though sales did increase online.
In the UK, total sales for the company's fourth quarter ended March 24 fell 5.6% year-on-year, and on a like-for-like basis they were down 2.8%. In the year-to-date, UK sales were down 4.8% and 1.3% like-for-like. However, in the quarter, website sales rose 7.2% like-for-like, and were up 2.8% year-on-year, while total online sales were up 2.1% in the period and 1.2% year-to-date.
Shares in Mothercare were 5.4% lower at 18.89 pence on Monday.
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