Ukraine war: Mothercare sees sales increase as it joins list of brands shutting down operations in Russia | Economic news

Mothercare, the retailer of products for young children and their parents, has joined the list of multinationals shutting down operations in Russia and has warned it will take a big financial hit in the process.

The company revealed on Wednesday morning that its decision to suspend operations would result in a loss of up to a quarter of its usual global revenue. Shares fell 25% in response.

He made the announcement hours after some of the world’s biggest consumer brands, including McDonald’s, Pepsi and Coca-Cola, bowed to intense pressure and revealed they would too. stop trade in Russia on the invasion of Ukraine.

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Burger King is among the names that have yet to follow suit.

Mothercare operates as a branded franchise operation after its UK store arm was placed in administration in 2019 to protect the brand’s entire business.

The company said in its statement: “Mothercare announces that all activities in Russia, including shipping of all products, have been suspended.

“Our local partner has confirmed that it will immediately suspend operations in some 120 stores and online.

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“Russia accounts for around 20-25% of Mothercare’s global retail sales and was previously expected to contribute around £0.5m per month to the group’s profits.

Energy, payment, entertainment and big tech companies, like Apple, Microsoft and Samsung, have shuttered operations or cut ties with Russia since President Putin’s military operation began last month.

Among the most recent companies to act is the owner of KFC, which said on Tuesday it was suspending operations at its 70 KFC-owned restaurants in the country and finalizing an agreement to suspend all operations at Pizza Hut restaurants in Russia, in partnership with its main franchisee. .

Yum Brands, which has at least 1,000 KFC locations and 50 Pizza Hut locations in Russia that are almost all independent franchisees, added that all investment in the country has been halted.

Unilever – the UK-based consumer goods giant behind brands such as Dove soap, Marmite and Knorr – was another to reveal its hand.

Key developments:
US bans Russian oil imports, UK to phase them out by end of year
US says Poland’s offer of MIG-29 fighter jets to Ukraine ‘untenable’
Criminal offense for any Russian aircraft entering UK airspace, says Transport Secretary
First Lady Olena Zelenska writes open letter condemning Putin and ‘mass murder of civilians’
Woman charged in New York with being a Russian agent for more than a decade

It suspended all imports and exports of its products to and from Russia and said it would no longer invest capital in the country.

The company condemned the war in Ukraine as “a brutal and senseless act of the Russian state”, but added that it would continue to provide the people of Russia with daily essential food and hygiene products.

That decision, the company said, needed to be reconsidered.

Sky News has contacted KFC and Burger King for comment.

Sallie R. Loera