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(Sharecast News) - Mothercare announced some changes to its leadership team on Thursday as it said it was "broadly on track" with its planned recapitalisation.
The parent and child retailer, which closed all of its 79 UK stores last weekend, said Mark Newton-Jones will step down as chief executive officer with immediate effect, staying on as an executive director until July.
Chief financial officer Glyn Hughes will become interim CEO and Andrew Cook, who has served as corporate development director since April 2019, will become CFO with immediate effect. Clive Whiley will become non-executive chairman with effect from March.
Whiley said: "The board changes announced today align the management of Mothercare with that of a its new structure as an international franchise brand and will contribute to a further overhead reduction.
"In time we plan to add relevant skills and expertise - particularly in brand and product management - to the team to accelerate our development as an international brand owner and operator."
Mothercare also said it had raised £8.7m from its existing investors and that there has been a ""substantial" reduction in its bank debt through the administration of it UK business. The group said it continues to explore options to finalise the recapitalisation in line with the guidance given in November.
Whiley said: "We have made good progress with the transformation plan and the risks to achieving the outcomes we laid out in November are increasingly dissipated.
"Our plans for the final steps of the recapitalisation of the group are in hand and whilst the cash realisation from the Mothercare UK administration was lower than anticipated, the progress that we have made elsewhere means that the financing requirement overall is unchanged from our original plans."
At 1350 GMT, the shares were down 7.5% at 15.43p.
Broker Shore Capital said: "Whilst there is more to do to dot the 'Is' and so forth, we are pleased to see the progress that Mothercare is making. The near-term actions are likely, to our minds, to stall the scope for share price appreciation, but once settled as a debt-free, capital light business, we see the energies of management more productively becoming focused on the day job to deliver value for shareholders through product design and brand management.
"As such, we reiterate our 'buy' stance in the expectation of more share price appreciation in the latter half of 2020."
10 May 2024 16:55
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