Mothercare posts annual loss as Boots exit and Middle East geopolitical tensions weigh on turnover

UK-based specialist parenting and kidswear group Mothercare has reported its full-year financial results for the 52-week period ended March 28, 2026, recording a statutory loss after tax of 5 million pounds. The performance represents a decline from a statutory profit of 6.2 million pounds achieved in the prior financial year ended March 29, 2025.

Group turnover for the period dropped 42 percent to 22.4 million pounds, down from 38.9 million pounds in 2025. Adjusted EBITDA decreased 63 percent to 1.3 million pounds, compared to 3.5 million pounds in the previous year. Net debt stood at 6.4 million pounds as of March 28, 2026, widening from 4.5 million pounds recorded at the end of the previous period.

International franchise sales and geographic performance

Worldwide retail sales generated by Mothercare’s global franchise partners fell 22 percent on a reported basis (19 percent in constant currency) to 180 million pounds, compared to 230.6 million pounds in the prior period. The company attributed the top-line contraction to two primary headwinds: the termination of its exclusive distribution agreement with UK retailer Boots at the close of 2025, alongside ongoing geopolitical instability across its Middle Eastern markets, including disruption stemming from conflict in Iran during the final month of the financial year.

Excluding the impact of operations in the Middle East and the UK, like-for-like (LFL) retail sales across the group’s remaining international footprint were positive for the full year. Online retail sales accounted for 12 percent of total franchise retail turnover, totaling 20.9 million pounds.

The group’s retail store footprint contracted by 11 percent during the year, ending the period with 331 store locations, down from 372 stores as of March 29, 2025.

Regional turnover breakdown

The company's revenues in Asia declined to 7.4 million pounds, down from 10.9 million pounds, Europe registered revenu of 6.6 million pounds, down from 8.8 million pounds, Middle East sales contracted to 6.4 million pounds versus 9.3 million pounds and UK declined to 2 million pounds compared to 9.9 million pounds last year.

To streamline its business structure into an asset-light franchising model, Mothercare completed a joint venture transaction in October 2024 for the South Asian region with Reliance Brands, a subsidiary of Indian conglomerate Reliance Industries. Reliance Brands aims to expand retail sales within the South Asian territory to approximately 300 million pounds over a five-year period, supported by a physical store expansion plan targeting 50 new store openings in 2026. Mothercare also expects to generate ongoing sourcing fees alongside returns from its 49 percent stake in the JV.

Additionally, the group signed a brand license agreement with ebebek in Turkey and remains in active negotiations to secure a new retail distribution partner for the UK market.

Current trading and outlook

During the first 19 weeks of fiscal year 2027, franchise partners recorded total retail sales of 58.5 million pounds, compared to 68.8 million pounds in the prior-year period, reflecting ongoing pressures in the UK and Middle East. Excluding those two markets, LFL sales trends remained positive.

In an official statement, Clive Whiley, chairman of Mothercare, said: “The recent financial performance has been resilient as we look to FY27, acknowledging the ongoing situation in the Middle East and the end of our arrangement with Boots in the UK alongside our progress in other markets. We remain in discussions to restore critical mass, a process greatly assisted by our successful refinancing and better alignment of the first-charge debt instrument with our equity.”