Mothercare annual report fails to keep up with turbulence

In his statement in the report, published on 14 June, chairman Clive Whiley thanks Mark Newton-Jones for his efforts as chief executive and presents David Wood as his replacement.

“In light of the wider sector challenges, it is essential that we accelerate the transformation plans to meet our ambitions for both customers and our shareholders,” Whiley wrote. “As a result, fresh leadership has been put in place to take Mothercare into the next phase of its turnaround.”

Wood replaced Newton-Jones on 4 April with immediate effect. But Newton-Jones was re-appointed as CEO on 18 May in a surprise move with Wood switching to become group managing director. The boardroom musical chairs have left Whiley welcoming new management in the report when the old CEO is back in place.

The annual report lists Wood as CEO and features a statement on strategy by him. Shareholders will have to turn to page 129 of the 140-page document for a footnote listing Newton-Jones’s return as a post-balance sheet event.

The report appears to have been caught up in a series of events as Mothercare struggled for survival. After Wood took over as CEO, Alan Parker departed as chairman on 4 April and was replaced by Whiley who then re-hired Newton-Jones the day after the company’s annual results, which appeared on 17 May.

Mothercare is closing 50 stores and raising £28m from shareholders as part of a £113.5m funding deal to strengthen its finances after swinging to a £72.8m annual loss. Like other retailers it has struggled as British shoppers have tightened their belts and competition has intensified on the high street.

The annual report showed Newton-Jones earned £727,000 in the last financial year made up mainly of his £618,000 salary. The year before he earned £718,000. He received no bonus in either year. His salary has been cut to £480,000 for his second stint as CEO.