UPDATE 1-Mothercare sales hit by poor UK performance

LONDON Thu Jan 17, 2013 2:17am EST

LONDON Jan 17 (Reuters) - British baby and maternity products retailer Mothercare posted a 7.4 percent fall in third quarter total group sales, as recent improvements to its British arm failed to pull in the Christmas sales.

The group, which has over 1,300 stores worldwide including 269 in the UK, said on Thursday British like-for-like sales fell 5.9 percent in 13 weeks to Jan. 12, while overseas underlying sales rose 14.8 percent.

The fall in British sales compared with a 3.0 percent decline in the same period a year earlier - its strongest showing that year due to higher levels of discounting - and also reflects the ongoing close of loss making stores in Britain.

"We have made solid progress during Q3, despite a challenging consumer backdrop for the UK and Eurozone," Chief Executive Simon Calver said in a statement. "Our three-year transformation and growth plan remains on track."

Mothercare is improving its stores and delivery services as as well as slashing prices in a bid to wrestle back cash strapped customers from supermarkets and online retailers.

In November it narrowed its losses for the first half of the year to 0.6 million pounds, compared with a loss of 4.4 million a year ago.

Shares in the firm closed at 304.25 pence on Wednesday and valuing the business at around 271 million pounds ($433 million).

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