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Mulberry Group PLC on Wednesday reported a ‘resilient’ half-year performance as it prepares for the festive trading season ahead, despite suffering a loss and a slip in revenue.
Shares were down 12% at 252.00 pence each on Wednesday in London.
Mulberry is a Somerset, England-based luxury fashion company.
For the 26 weeks that ended on October 1, the company swung to a pretax loss of £3.8 million from a profit of £10.2 million the year before, as operating expenses jumped by 42% to £48.6 million from £34.3 million.
Mulberry said profit last year had benefited from a one-off profit of £5.7 million on the termination of a lease in Paris and for business rates relief worth £2.0 million.
Revenue slipped marginally by 1.2% to £64.9 million from £65.7 million.
Mulberry said UK retail sales were hurt by a weak economic environment, falling by 10% to £34.1 million from £38.0 million a year before. However, in China, retail sales increased despite Covid restrictions, which contributed to a 0.8% increase in Asia-Pacific retail sales to £11.9 million from £11.8 million a year earlier.
Gross margin increased to 71% from 69%, supported by Mulberry’s ‘focus on full-price sales and increased volume efficiencies’.
Chief Executive Officer Thierry Andretta said: ‘We have delivered a resilient performance across the group, supported by strong international demand and continued investment in the UK. Looking ahead, we are confident in our ability to execute our strategy and to continue to invest across the group for our future growth, in spite of the challenging economic and geopolitical backdrop.’
Net cash amounted to £6.5 million at period-end, down from £30.3 million a year before.
Looking ahead, Mulberry said that while the economic environment remains uncertain, it is well-placed for Christmas trading.
In the financial year that ended April 2, pretax profit had quadrupled to £21.3 million from £4.6 million, as revenue surged 32% to £152.4 million from £115.0 million.
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