Mothercare CEO falls on (plastic) sword

Well: it looks like Ben Gordon, the CEO of Mothercare, has nobly taken one for his team, after the company announced his resignation today. Apparently, Gordon stepped down ‘by mutual consent’, and will have his last day on November 17, just after the company’s interim results. To be fair, something was going to have to give: after all, the company did post a pretty dire set of results last week. To add insult to injury, though, shares in Mothercare have already risen by 12.6%, to 216.8p. Talk about kicking a man when he’s down…

Alright, so Mothercare’s results, published on Wednesday, were about as bad as it gets: UK like-for-like sales had dropped by 9.6% in the 12 weeks to October, and although overall sales were propped up by a roaring trade in the company’s 969-store international division, that’s not going to have much of an impact on its overall finances, because its international stores are franchised. In fact, so grim has it got that in the City, analysts dropped their profit forecasts by 80%, and shares closed down 41% on Wednesday. Which has to be embarrassing…

Mothercare’s excuse was that parents, struggling with their finances, have moved away from posh prams made by the likes of Mamas & Papas and Bugaboo, and towards cheaper imitations, while clothing sales have also begun to drop. And Mothercare isn’t the only one: according to stats released this morning by the British Retail Consortium, while sales of non-food items improved slightly in September compared with the same time last year, sales of clothing ‘dropped off sharply’.

And given all the doom and gloom we heard about this morning, that’s a situation we should expect a lot more of over the coming months. Let’s hope other retailers are more sympathetic with their CEOs – otherwise there might not be any left…