While other retailers are throwing their toys out of their proverbial prams in disgust at the downturn in consumer spending, Mothercare has finally moved off the investors’ naughty step and announced first half pre-tax profits up 124.6 per cent to £13.7m.

It is about time. Throughout much of the last decade, Mothercare suffered as mums-to-be and new mothers shunned its dowdy stores stocked with even dowdier products.

With competitors like Gap, Boden and H&M offering up-to-date baby fashions at suitably compact prices, Mothercare lost its advantage as the only high street retailer dedicated to children and their needs.

Indeed, just six years ago Mothercare teetered on the brink of bankruptcy, reporting pre-tax losses of £24.6m. But then Ben Gordon arrived as chief executive and has performed a trick of which a child’s entertainer would be proud.

The former managing director of Disney Stores Europe and Asia Pacific first saw off the venture capitalists that were circling the beleaguered business.

And then Mr Gordon, a father of three, tackled Mothercare’s dismal distribution. Shortly before he arrived the store’s former bosses had signed up for a major distribution centre in the Midlands, operated by a logistics specialist. It experienced problems from the outset, causing Mothercare to miss out on the crucial Christmas trading period.

Mr Gordon reviewed and revamped the distribution situation, improved the available product range and then emulated a trick performed by Sir Philip Green, boss of BHS, switching from dependence on wholesale sources for a significant portion of Mothercare’s clothing range to buying directly from the suppliers.

Within six months of Mr Gordon’s arrival, he had improved Mothercare’s gross margin by more than five percentage points. He has continued to build on that. In the six months ending October, Mothercare’s gross margin for its UK operations rose by 0.1 per cent.

Group sales rose 9.3 per cent to £359m over the same period, as new ranges, such as babywear clothing line Baby K, launched by celebrity mother Myleene Klass, and the ability to customise buggies with Mothercare MyChoice buggy system proved a hit with mothers.

Today’s stores bear no resemblance to the shabby shops that Mr Gordon took over, while extensive training has transformed and motivated staff.

Last year Mothercare acquired the Early Learning Centre, a complementary retailer that fits nicely into the mix. Mr Gordon has spent the intervening period restructuring Early Learning Centre’s head office and revamping its supply chain.

He has also introduced Early Learning Centre into some Mothercare stores, incurring one-off marketing costs of £500,000 to do so. There are plans to roll this out across Mothercare’s entire branch network, and so confident is Mr Gordon in this strategy that he forecast the integration of Early Learning Centre will deliver at least £10m in benefits by next year.

But Mothercare, under Mr Gordon’s stewardship, is no longer an only child. Mothercare Direct, which focuses on online retail, enjoyed a 25.4 per cent rise in sales to £50.4m. The company now has the widest selection of pushchairs, car seats and baby care products available online in the UK.

Mothercare’s social networking site, Gurgle.com, which allows mothers to share the stresses and joys of parenthood, celebrated its first birthday with 70,000 registered users around the world and 250,000 unique visitors every month. With big brand advertisers keen to get involved, the site is now close to achieving ‘break even’.

When Mr Gordon took over, he put on permanent hold plans for Mothercare World superstores but accelerated Mothercare’s expansion internationally, adapting the franchise model to ensure franchisees made royalty-based payments based on sales rather than one based on shipments.

Today, Mothercare has 572 stores in 49 countries outside the UK and, in the six months ending October, the international business enjoyed its best ever half-year performance with a nine per cent rise in like-for-like sales. Overall, franchise retail sales rose 37 per cent to £195m while underlying profits grew by 59 per cent to £7m.

Mr Gordon believes there is further room to grow internationally, and has plans to open ten new stores in China, following a successful trial in Shanghai, 40 shops in Russia and expand in the Middle East and the Asia Pacific.

With no debts and £9m in the bank, Mothercare is, according to Mr Gordon, well placed to withstand the current economic climate. As Keith Bowman, equity analyst at Hargreaves Lansdown stockbrokers, puts it: ‘All in all, Mothercare is a currently a rare breed – the retailer continues to flourish on a wide geographical basis, the product retains defensive qualities while the balance sheet is relatively strong.’

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