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Mulberry Group PLC on Wednesday said annual revenue was down due to declining luxury consumer spending and challenging macroeconomic conditions, especially in the last quarter. In the financial year ended March 30, revenue was down 4% or 2.7% at constant currency, with gross margins maintained around those reported for the first half of the year. Mulberry said full-year losses will be hit by the additional operational costs of new stores in Sweden and Australia. This is alongside ongoing ‘important’ investments including technology, which Mulberry said supports its future growth. It said retail sales were in line with the prior year driven by growth in Europe, which included the first full period of ownership of its Swedish stores, and in the US, due to increased brand awareness and our direct to customer strategy. This was offset by a decline in the UK and Asia Pacific excluding Australia, which Mulberry said ‘continued to be challenging due to the macro-economic climate in China and reduced footfall across the region’. Mulberry also said falling franchise and wholesale sales was ‘broadly in line’ with the first half of its financial 2024, due to wholesale arrangements which converted to retail. ‘While we achieved positive revenue growth in the first half, Mulberry has not been immune to the broader downturn in luxury spending experienced in recent months, particularly in the UK and Asia. This decline was partially offset by positive trading in the US, where we have benefitted from increased brand awareness,’ said Chief Executive Officer Thierry Andretta. ‘Looking ahead, the trading environment in the UK and China remains challenging and we do not expect this to change in the short term. We are therefore managing the business prudently, focusing on executing our strategy and vision to become a global sustainable luxury brand.’ Shares in Mulberry were down 2.3% to 105.00 pence each in London on Wednesday afternoon. Copyright 2024 Alliance News Ltd. All Rights Reserved.
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