Proposed Disposal of Bhs & Estimated Results

Storehouse PLC
26 April 2000


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Canada, Australia or Japan

                     Storehouse plc ('Storehouse')

             Proposed Disposal of Bhs and estimated result
                    for the year ended 1 April 2000

Storehouse plc announces that a circular relating to the proposed
disposal of Bhs to Measuremarket for a total cash consideration of £200
million is being posted to Shareholders today.  The following
announcement summarises certain information contained in that circular.

*  The Board of Storehouse announced on 7 April 2000 that it had reached
   agreement to dispose of Bhs to Measuremarket for a total cash
   consideration of £200 million.
   
*  Following the Disposal, Storehouse intends to return to Shareholders
   approximately £100 million of the proceeds.
   
*  The balance of the proceeds of the Disposal, net of costs, will be
   used to repay all Group debt, which amounted to approximately £70
   million as at 1 April 2000, and in the continuing development of
   Mothercare.
   
*  Following completion of the Disposal the Board plans to change the
   name of the Company to Mothercare plc.  The Group's management and
   financial resources will be concentrated on the acceleration of the
   Mothercare recovery programme.


Estimated Bhs result for the year ended 1 April 2000

The performance of Bhs since the Storehouse interim announcement on 18
November 1999 has continued to decline with like for like sales and
margins down on the year. Bhs has continued to lose market share in
both clothing and home, undermining both its turnaround strategy and
the Board's plans to separate Bhs and Mothercare.

For the year to 1 April 2000 Storehouse estimates that Bhs made a
retail profit before exceptional items, interest and tax of £13.1
million. This compares to a profit before exceptional items, interest
and tax in the previous year of £86.4 million. As announced on 18
November 1999 in Storehouse's interim report for the 28 weeks ended 9
October 1999, management had intended, prior to the Disposal, to take a
substantial exceptional charge in the second half year to reflect the
proposed restructuring of Bhs.

Sales for the year to 1 April 2000 were £822.4 million (1999 £856.2
million). In the second half of the year, which includes the key
Christmas period, total UK sales (excluding the benefit of the 53rd
week) were down 1.6 per cent. (down 4.4 per cent. on a like for like
basis), with gross margin 2.6 percentage points lower than last year.
Bhs franchise sales in the second half (excluding the benefit of the
53rd week) were down 54.6 per cent. This performance has under-
delivered against the strategy set out in November.


Estimated Mothercare result for the year ended 1 April 2000

By contrast, the recovery programme at Mothercare, which will restore
Mothercare's brand position as a destination store for all the needs of
parents and young children, is beginning to have an effect. The
successful Mothercare World format will be expanded, Mothercare
International is improving and Mothercare Direct will be much enhanced
with the launch of Mothercare.com in June of this year.

For the year to 1 April 2000 Storehouse estimates that Mothercare made
a retail profit before exceptional items, interest and tax of £0.4
million. This performance has resulted from the business returning to
profitability in the second half of the year, with a profit of £3.7
million, versus a loss of £3.3 million for the 28 weeks ended 9 October
1999. This compares to a profit before exceptional items, interest and
tax in the year to 27 March 1999 of £17.9 million.

Sales for the year to 1 April 2000 were £443.7 million (1999 £472.4
million). In the second half of the year (excluding the benefit of the
53rd week) total sales in Mothercare's UK ongoing stores (i.e.
excluding the 82 disposal stores) increased by 3.3 per cent. (flat on a
like for like basis) compared to a 0.1 per cent. decline during the
first half (flat on a like for like basis). Gross margin in these
stores was down 0.3 percentage points in the second half compared with
a fall of 3.7 percentage points in the first half. Sales to overseas
franchises declined by 5.3 per cent. in the second half (excluding the
benefit of the 53rd week) compared to 38.7 per cent. in the first half.

It was announced in Storehouse's interim report for the 28 weeks ended
9 October 1999 that management intended to take a substantial
exceptional charge in the second half year to reflect the proposed
restructuring of Mothercare.


Application of proceeds of the Disposal

Following the Disposal, Storehouse intends to return to Shareholders
approximately £100 million of the proceeds.  It is proposed that the
return of capital will be effected by means of a capital reduction, to
be implemented via a scheme of arrangement under Section 425 of the
Companies Act 1985.  A further circular setting out the procedures and
resolutions required to effect the return of capital will be sent to
Shareholders following completion of the Disposal.

The balance of the proceeds of the Disposal, net of costs, will be used
to repay all Group debt, which amounted to approximately £70 million as
at 1 April 2000, and in the continuing development of Mothercare.


Other information

Following completion of the Disposal the Board plans to change the name
of the Company to Mothercare plc.

The Disposal is conditional, inter alia, upon the approval of
Storehouse's shareholders.  An extraordinary general meeting to approve
the Disposal will be held on  16 May 2000.

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Enquiries

Storehouse                                    020 7339 2579
   Alan Smith (Chairman)                      
   Chris Martin (Finance Director)            
                                              
Brunswick                                     020 7404 5959
   Susan Gilchrist                            
   Victoria Sabin