Mothercare

Mother and baby retailer Mothercare (MTC) has reported a 3% slide in like-for-like sales amidst an 'increasingly competitive consumer environment'.

The fully-listed outfit declared the slide in like-for-likes (against the 9.6% decline reported in the last quarter) for the 13 weeks to 7 January. Total group sales fell by 1.2% while total uk sales fell by 6.9% as a result of a number of store closures. Its online division 'Direct in Home' reported a 2.2% fall in turnover.

However despite the overall decline in revenue, international retail sales climbed by 15.5% with Mothercare noting that it had opened stores in new territories including Morocco, Chile, Colombia and Iraq.

Following the update, analysts at Numis lowered their profit forecast for 2012 from £5.4m to £1.3m (EPS: 1.2p) on turnover of £1.2bn.

Last October Growth Company Investor rated shares in Mothercare as a 'sell' at 177p, citing factors including the increasing competition from rivals such as Kiddicare and arguing that there are 'questions over its competitiveness on price' and its 'ability to provide the breadth of products' of retailers such as Tesco. These pressures remain on the company, with competition in the online space in particular mounting. We retain our sell rating.