Mothercare, the British heritage baby and childrenswear brand, said its leading Middle Eastern franchise partner told the company that it is reviewing its Mothercare stores across the region.
The partner expects that review to result in the closure of the substantial majority of its franchised stores in the territory during 2027.
That will trigger a material reduction in Mothercare's order book for the 2028 financial year, with a corresponding hit to revenues, profits and cash flows.
The company said it has enough resources to trade for several months and has launched a strategic review of its business model and cost base to try to preserve value for stakeholders.
Mothercare described the longer-term solvency of the business as "highly uncertain" at this stage.
"Whilst our recent financial performance has been resilient, this is a heavy blow to the Mothercare business and our stakeholders", said chairman Clive Whiley, adding that the company will keep pursuing discussions to restore scale and value against a tougher backdrop.
