Cheap Mulberry is providing customers with a more affordable option.Profit for the year, expected to be around ￡4.7million, could be better than forecast due to tighter cost controls, chairman Godfrey Davis said.The brand’s new chief executive Thierry Andretta joined this month and a new creative director, Johnny Coca, is due to join in July.But Mulberry said cost controls would still put profit before exceptional items slightly ahead of market forecasts. Analysts are on average expecting a pre-tax profit of ￡4.7m, down 66 per cent on 2013-14.Of course, much has changed for the company over the past year. CEO Bruno Guillon, who came to Mulberry from Hermès in 2012, stepped down in March, and former CEO Godfrey Davis has stepped in until a permanent replacement is found. Meanwhile, Mulberry hasn’t had a creative director since last June.Mr Solca also believes the repositioning is the right strategy. “The opportunity in the accessible luxury space is very important,” he says, noting that brands are all growing well.
Mulberry is also far less developed internationally than some of its rivals, including Burberry. It has only a handful of stores in China. However, Mr Davis says cheap Mulberry Outlet more limited global reach provides it with upside. “That is an opportunity for us to grow substantially in the future. I do expect to make some growth in the UK. But over the next five years, I expect the main growth to come from these international markets,” he says.High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail.The company continues to expect a double-digit decline in wholesale sales – which includes sales through international partners – this year, as the changes take time to come through. Meanwhile, it is still without a creative director.
Handbag maker Mulberry revealed that its turnaround strategy may be finally working.The English luxury brand, which has suffered a series of profit warnings over the past year and ousted its chief executive Bruno Guillon after a move to go upmarket backfired, has recently focused on cost-cutting and making more bags at the cheaper ￡500-￡800 level.House broker Barclays said that the group had ‘benefited from the actions taken last year to introduce new products’ as well as a from a successful digital marketing campaign.Godfrey Davis, the chairman who took Mulberry Online from a dowdy leather goods business to a hip handbag maker, and has stepped back into an executive role following Mr Guillon’s departure, acknowledges the company made mistakes.
Revenues for the year are expected to come in at £146m, down from £163m in the previous 12 months, as the improvements in retail sales are wiped out by a decline in wholesale turnover. The company, which makes its bags in Somerset, is still facing declining sales in some areas. Like-for-like UK retail sales dropped 7pc last year, with outlet sales still falling in the past six months even as full-price shops showed improvement. Mulberry Outlet Uk Aim-listed shares fell 0.7pc to 869p. The stock peaked at almost £25 in 2012, before slower growth in Asian luxury sales and a series of strategic mis-steps sent the stock tumbling.