Mulberry reports positive growth in international markets

Total revenue at Mulberry of 74.6 million pounds (100 million dollars) was, the company said, in line with the prior year. The company said that retail sales increased, with the UK flat and international showing growth, while wholesale sales decreased, primarily reflecting the acquisition of two stores in North Asia. Mulberry added, a focus on full price sales and new products, with lower markdown sales during June and July, has contributed to the increase in gross margin to 61.5 percent.

Commenting on the company’s first half trading, Thierry Andretta, Mulberry’s CEO said in a statement: "Our international platform is taking shape and we have seen a successful initial trading period in Japan through our collaboration with OGF. We continue to see strong demand from tourists in London and whilst the UK remains uncertain, 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."

Review of Mulberry’s H1 results

Retail sales including digital were up 2 percent to 56.6 million pounds (76 million dollars) for the period with like-for-like sales down 1 percent. The UK retail business saw an increase in tourist spending in London while the company added that domestic demand slowed. International retail sales were up 8 percent with strategic locations showing an encouraging performance on new products while portfolio development continues and includes the addition of stores in Hong Kong. Global digital sales were up 3 percent to 10.7 million pounds (14 million dollars) for the period, accounting for 14 percent of group revenue.

There were 66 directly operated stores at the end of the period. The company’s main focus during the period was on enhancing and expanding the international store network in Hong Kong, China and Japan.

Wholesale revenue, comprising sales to partner stores and selective multi-brand wholesale accounts, decreased 6 percent to 18 million pounds (24 million dollars). The franchise store network at the period end had a total of 55 stores in Asia, Europe and the Middle East. Two stores were acquired by Mulberry Asia and transferred from franchise stores to directly operated stores in the group's own retail store portfolio.

During the period, Mulberry and OGF collaborated on the transfer of one existing store to Mulberry Japan and the opening of three stores in Tokyo Ginza, Kyoto and Nagoya. One further store was opened after the end of the period in Osaka.

Mulberry to focus on international markets for growth

The company said, like-for-like retail sales including digital were up 1 percent for the 10 weeks to 2 December 2017. In the UK, like-for-like sales were down 1 percent reflecting a continued increase in tourist spending in London whilst domestic demand has been slower. International like-for-like sales were up by 12 percent during the 10-week period and continue to show an encouraging response to the new collections.

The group aims to continue its focus on advancing its international development strategy during the current financial year with increased distribution and marketing investments planned. The group anticipates the acquisition of the three China stores by the end of the current financial year, which is expected to reduce the group's wholesale revenue and increase retail revenue during the second half of the financial year.

Mulberry added that the group will continue to strengthen its position in the UK and expand internationally through its omni-channel strategy, with well situated stores complemented by a strong digital presence. The penetration of omni-channel is expected to grow in the UK, Europe and North America, through continued enhancements of the offering. The group also plans to introduce omni-channel services to newly controlled territories, including China, Hong Kong and Australia.

Picture:Facebook/Mulberry