Mulberry grows sales and swings back into profit

British luxury brand Mulberry has swung back into profit in the year ending 31 March 2016. The company achieved a profit after tax of £2.7m (compared to a loss of £1.4m the previous year) on sales up up 5% at £155.9m.

Mulberry achieved good growth in retail sales during the financial year, which were up 8% to £118.7m, but cited digital as a particular high point with sales up 19% at £21.4m. Digital now accounts for 14% of group revenue, compared to 12% in the previous year.

Profits had been improved thanks to efficiencies achieved at its Somerset manufacturing base which produces around 50% of the brand's handbags, the company said. And a revision of its prices (which had been pushed too high under previous CEO Bruno Guillon who exited the company in 2014 and was replaced by Thierry Andretta) has helped drive growth as brand has found favour again among its core customer base.

Also significant during the year was the appointment for Johnny Coca as creative director. Formerly of Céline, Coca put the brand back on the map at London Fashion Week in February following a two-year hiatus with a collection that was well received by buyers and press alike.

"We have built a strong foundation for future growth as a result of the investment made in product design and development as well as our omni-channel infrastructure," said Andretta. "Looking forward, we will invest further in developing exciting new product, whilst continuing to engage with our core UK and growing international customer base.

Mulberry's new Bayswater

Coca has been innovating with the Mulberry line since his arrival last year. Several new styles have been launched including the Maple, a tote with a distinctive external pocket, the Winsley, a more grown-up shoulder/cross body bag with chain strap, and the compact cross-body Clifton bag. He has also reworked the brand's signature Bayswater style, removing the external buckles and moving the internal pocket to the front. The new version is also lighter to carry.

The crucial aspect of these new designs, however, is the price. Prices for the Clifton start at £595 and a small Bayswater starts at £845. Only a few styles tip over the £1,000 mark and those that do feature more complex designs or expensive materials.