Luxury fashion and accessories retailer Mulberry has reported deepening losses and falling sales as focus shifts on need to “reprioritise” and “rebuild” business.
Mulberry reported an underlying loss before tax of £15.3m for the 26 weeks to September 28, 2024, up from a loss of £12.8m last year.
The group also posted a 19% decline in group revenue to £56.1m, down from £69.7m during the same period last year.
Retail sales in the UK fell 14% during the period from £36.2m to £31.3m, while in the Asia Pacific region retail sales also dropped 31% from £13.5m to £9.3m.
Total international retail sales at Mulberry also dropped 17% to £19.5m, down from £23.5m in 2023.
Mulberry said its increased loss before tax was due to “reduced revenue and margin partially offset by lower operational costs”.
The luxury retailer also noted an equity fundraising amount of £10.4m and increased debt facilities, which it said will “strengthen further the group’s balance sheet” in order to support its turnaround strategy.
With an eye on online sales, Mulberry said its digital performance was “robust” with online sales representing 33% of its total group revenue and UK online sales via its website up 6%.
Mulberry blamed the “ongoing inflationary pressures” for providing uncertainty to the group and said trading for the full year is anticipated to be “weighted towards the second half” as a result of the key Christmas trading period.
Mulberry chief executive Andrea Baldo said: “Though I’ve only been in the role of CEO for under three months, the first half results illustrate the clear need to reprioritise and rebuild the business. Mulberry is an iconic brand. It stands out for its rich heritage and craftsmanship – qualities that our customers recognise and value deeply. Combined with our unique position in the market, offering responsible luxury products of unmatched quality and longevity, crafted in our Somerset factories, Mulberry truly is one of a kind. We are now working on initiatives to renew the brand’s relevance, initially for UK consumers and then for our international audience.
“In response to current market conditions, we have taken decisive steps to streamline operations, improve margins, reduce working capital, and strengthen our cash position. This has also meant reviewing our internal team structure to ensure we become a leaner, more agile organisation. Additionally, we’ve made strategic adjustments to our product, pricing, and distribution strategies, and we’ve begun discussions with luxury wholesale partners to ensure we are present wherever our customers shop.
“There is no question that our industry is facing a period of significant uncertainty, driven by a challenging and volatile macroeconomic environment that is impacting consumer confidence in several markets, particularly in our home country. However, with the teams’ efforts on cost-cutting, a strengthened balance sheet, a renewed brand-first approach and a refreshed business strategy-details of which I’ll share in due course – I am confident we are making the right moves to bring Mulberry back to profitability.”
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