Total revenue for Mulberry for the six months to September 30, was virtually flat at £74.6 million (actually a year ago it was £74.5 million), with sales through its Retail channel up 2% to £56.6 million, but comparable sales down 1%. The gross margin increased 248 basis points (up £1.9 million) due to its full-price focus, and its all-important cash balances increased to £16.4 million from £11.3 million “after higher investment levels”.
But while Retail sales increased, the UK was flat. London may have been helped by that healthy tourist spending, but domestic demand beyond the city was lower. Meanwhile sales for its International operation grew 8% to £11.3 million with strategic locations showing “an encouraging performance on new products”. Global Digital sales were up 3% to £10.7 million for the period from £10.4 million, accounting for 14% of group revenue.
CEO Thierry Andretta was able to justifiably claim that the company is “delivering on our strategy to grow Mulberry as a global luxury brand.” He added that the “focus on full-price sales growth has delivered good results with new designs proving popular with customers” and highlighted that Amberley bag success after the product was only launched as recently as June.
He also said that the increase in tourist spending in London has been crucial, despite the fact that “the UK remains uncertain” and insisted that “the group remains in a strong position to invest in further developing the customer experience in key international markets and enhancing its unique UK design and manufacturing base.”
The International performance has been helped by the firm’s Asian agreement with Onward Global Fashion Co (OGF) to develop the business in Japan. An initial presence of four stores “in key locations” has been expanded and there are now five stores in operation.
For the future, Mulberry will continue with its see now, buy now approach. It held previews of its SS18 collection to international press and buyers in Paris recently. And the collection will be unveiled during London Fashion Week in February 2018 to “offer an instantly shoppable, real-time global consumer experience” with the shift meant to enable it to “continue to drive engagement and increase relevance with its customers.”
It will also “continue to strengthen its position in the UK and expand internationally through its omnichannel strategy, with well situated stores complemented by a strong digital presence.” It said the penetration of omnichannel is expected to grow in the UK, Europe and North America and it also plans to introduce omnichannel services to newly controlled territories, including China, Hong Kong and Australia.
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