Mothercare and Clinton Cards join retailers suffering from harsh winter weather

By DAILY MAIL REPORTER
Updated: 05:26 EST, 6 January 2011

Mothercare and Clinton Cards joined the retailers suffering a severe winter as snow hit sales and both revealed profits would be dented. 

Mothercare, which has 377 UK stores, said toy sales were particularly affected as December's Arctic blast wiped an estimated 4% off its UK sales figure for the final quarter of 2010.

UK like-for-like sales excluding VAT were down 5.8% in the 12 weeks to January 1, which led the retailer to warn that profits for the year to April were likely to be less than the City's expectations of £41m.

Care scare: Mothercare's toy sales were particularly affected as December's Arctic blast wiped an estimated 4% off its UK sales

Mothercare said UK sales in the final quarter of 2010 had got off to a strong start but were 'impacted significantly' by the snow in December.

Finance director Neil Harrington said UK like-for-like sales were down by 21% in one week in December which was particularly badly hit by snow. Mr Harrington said: 'The snow was a pain in the neck. Our customers have young babies and pushchairs or are pregnant, and don't come out in the snow.

'The snow came right at the peak time for ordering toys for Christmas.'

Not only did the Arctic weather keep shoppers at home during the key festive trading period, but it also forced the retailer to bring forward the cut-off point for Christmas deliveries to ensure customers received their presents on time. Mothercare said its UK gross profit margin would be 1% lower than previously expected as it put on post-Christmas sales to clear excess stock.
Pre-tax profits for the year would be down by between 10% and 15% in the year to April as a result.

Sales have been strong since the snow went, added Mr Harrington. And total international sales were up 17.6%, helping to lift total group revenues by 0.4%.

Shares in Mothercare were down 30.5p (5%) to 567.5p following today's update.

Like-for-like sales dropped 2% in its Clinton Cards shops in the five weeks to January 2, while its Birthdays brand saw a 1.5% fall.

The shortfall, which will impact annual results for the year to July 31, adds to the pressure on the chain after its profits slumped from £24million in 2008 to £13million in its last financial year.

The recent downturn in fortunes has prompted the company to unveil plans to update "the look and feel" of its Clinton stores, including a new logo, revamped shop fronts and redesigned uniforms.

Work on the overhaul is still taking place, but Clinton said today that it was on the brink of unveiling a new website encompassing the updated branding and features such as personalised card and gift services.

Chairman Don Lewin, who founded the business in 1968, said the impact of the weather on pre-Christmas sales was "very disappointing" but added that the company believed it had the right strategy to lead a turnaround.

The business has 649 Clintons stores and 161 outlets under the Birthdays brand. There are also 14 Birthdays stores in Ireland.

Fellow retailers Next and HMV have also said the snow hit their December sales.