Published: 17:42, 05 November 2019
| Updated: 17:47, 05 November 2019
All Mothercare stores are to be closed after the firm slumped into administration this afternoon.
The firm warned yesterday it was expected to make the move which puts some 2,500 jobs at risk.
It has now appointed PwC as administrators which advised the "UK store portfolio will be wound down over the coming weeks and months".
Zelf Hussain, joint administrator and PwC partner, said: "This is a sad moment for a well-known high street name.
"No-one is immune from the challenging conditions faced by the UK retail sector. Like many other retailers, Mothercare has been hit hard by increasing cost pressures and changes in consumer spending.
“It’s with real regret that we have to implement a phased closure of all UK stores. Our focus will be to help employees and keep the stores trading for as long as possible.”
It currently has more than 1,000 stores internationally in more than 40 countries, with overseas stores generating profits of £28.3m. However, in contrast, the UK retail outlets lost £36.3m.
The main Mothercare Group is not impacted by the administration.
Clive Whiley, chairman of Mothercare said: "It is with deep regret and sadness that we have been unable to avoid the administration of Mothercare UK and Mothercare Business Services, and we fully understand the significant impact on those UK colleagues and business partners who are affected.
"However, the board concluded that the administration processes serve the wider interests of ensuring a sustainable future for the company, including the wider group’s global colleagues, its pension fund, lenders and other stakeholders.
"No-one is immune from the challenging conditions faced by the UK retail sector..." - Zelf Hussain, joint administrator
“The UK high street is facing a near existential problem with intensifying and compounding pressures across numerous fronts, most notably the high levels of rent and rates and the continuing shifts in consumer behaviour from high street to online.
"Mothercare UK is far from immune to these headwinds despite the strength of the Mothercare brand, its exclusive and quality product range and recognised customer service. Despite the changes implemented over the last 18 months contributing to a significant reduction in net debt over the same period, Mothercare UK continues to consume cash on an unsustainable basis.
“The action announced today has been carefully thought through and without it, the existence of the wider group would be threatened."
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More by this authorChris Britcher