Mothercare issues profit warning

6th Jan 2011 07:13

Mother and baby retailer Mothercare today warned that it now expects full year underlying pre-tax profit to be below current market expectations after disappointing Christmas sales.UK like for like sales in the third quarter fell 5.8% as freezing temperatures kept would be shoppers at home.Toy sales were particularly affected, as were online sales as the retailer cut off Christmas orders early, amid adverse weather conditions, to make sure customers received their goods in time. Gross margin will be 1% lower than previous guidance, Mothercare said, and whilst this will be partly offset by cost savings, full pre-tax profit is expected to be hit.Meanwhile International continues to grow rapidly with sales up 17.6% between September and January from the same time a year earlier. Mothercare has opened 157 new overseas stores in the last year taking the total to 885. In the UK however it said it is 'planning cautiously where the consumer environment remains difficult.'The Asia-Pacific region, which includes its three joint ventures in India, China and Australia, sales surged 49%.