Mothercare 's (MTC) latest update revealed that trading remains tough - first-half like-for-like sales slumped 3.4 per cent, for instance. But, amid all the gloom, there's evidence that restructuring efforts are beginning to deliver - we are therefore exiting our longstanding sell advice at 532p (5 November 2010).
Specifically, second-quarter UK like-for-likes sales grew 0.3 per cent, with total UK sales only down at all because of the closure of 31 stores. In fact, Mothercare has reduced its UK estate to 280 stores and eventually plans to cut that back to just the 200 most profitable ones. Meanwhile, the overseas business is growing fast, with half-year international retail sales having jumped 15.2 per cent. Numis Securities expects EPS of just 7.3p for end-March 2013, but that's forecast to rise to 26.6p a year later as restructuring momentum builds.
