Mulberry enjoys sales boost after lockdown but misses tourist spending
Mulberry has reported a boost in sales following the reopening of physical retail stores after lockdown, but it said it had missed out on tourist spending due to travel restrictions.
The British luxury house said sales jumped 34% in the six months to 25 September to £65.7 million, compared with £48.9 million a year ago when shops were closed for long stretches due to the various lockdowns.
It also swung back into the black, turning a £2.4 million loss into a £10.2 million pre-tax profit for the period. A focus on full-price items, moving away from discounting, helped gross profit margins improve from 59% to 69%. But tourists remain absent from UK high streets, the company said.
“Sales in the UK recovered strongly once our stores reopened,” Mulberry said. “The sales lost from the absence of tourists in the UK and the rationalisation of stores in Europe were replaced by strong growth in Asia.”
In China, retail sales jumped 38%, contributing to a 23% increase in sales in the Asia-Pacific region to £11.8 million, as the company continues to invest heavily in the area.
In the US, sales rose 57% to £3.3 million, while franchise and wholesale sales increased 67% to £10.1 million.
But while store sales improved, its online business dropped, with digital sales down 19% in the period to £19.1 million. By comparison, store sales were up 87% to £36.5 million.
The company said it has also managed supply chain delays hitting all sectors and business by stocking up on more raw materials in its Somerset factories.
CEO Thierry Andretta said the company was now focusing on achieving carbon reduction targets, including the use of the world’s lowest carbon leather through local and transparent supply chains.
“Our long-term strategy, namely our innovative and sustainable products made in our carbon-neutral Somerset factories, our market-leading omnichannel distribution model, and our expansion into Asia Pacific, has delivered a strong financial performance,” he said.
“Product innovation and sustainability are central to our strategy, demonstrated by the recent launch of our The Lowest Carbon Collection, further supporting the commitments we made in our Made to Last manifesto and our goal to reach zero carbon emissions by 2035.”