Mothercare MTC refuses to admit that its full year underlying profits will be below expectations, preferring instead to claim that they will be “within range” of market expectations, not you will note, within “the” range of those expectations. It also uses virtually every excuse available to modern management on how to avoid blame for its own shortcomings and shift it onto external causes.
Like for like UK sales did rise by 2.1% and online sales, which now account for 35% of those, did even better with a rise of 5.5% but in the end the figure which counts is that total UK sales for the year were up by only 0.8%.
It is on the international retail battlefield where Mothercare failed miserably Worldwide sales fell by 4.5% due not to the failings of management but to external causes for which management has no responsibility whatsoever.
International — ongoing economic and currency headwinds – — so sterling collapses and it is a disaster, just like it was when sterling was continually on the rise.
Middle East – lower oil prices
Asia – weakening consumer confidence
Europe & Latin America – again its those nasty adverse currency movements.
What Mothercare is really saying, without openly wanting to admit as much, is that its management failed to meet a single challenge presented by world markets. And they are all still in situ it appears, at least so far.
Debenham DEB is losing its CEO who has handed in his resignation today as the group announced a record Christmas and a 2.5% rise in the interim dividend. Profit before tax for the 26 weeks to the 27th February was up by 5.5% and basic earnings per share by 5.1%, the result of what the company describes as a strong operating performance. Internationally the picture was not as good with international EBITDA down by 5.8% due to ( go on, have a guess) – adverse currency movements. full year results are expected to be in line.
Lite Bulb Group LBB looks as if it is about to disappear from AIM following the resignation with immediate effect of finnCap Ltd. as its nominated advisor and broker. LBB says it is highly unlikely that it will appoint another NOMAD so in a months time it will automatically and unceremoniously be thrown off AIM. Should we keep our eyes on the woodwork and see what then comes crawling out.