Mulberry swings to profit in first half

Luxury handbag maker Mulberry said it swung back into profit in the first half as revenue rose and the group’s strategy began to bear fruit.

For the six months to the end of September, it reported pre-tax profit of £0.1m compared with a loss of £1.1m in the same period last year as revenue rose 5% to £67.8m.

Chief executive officer Thierry Andretta said: “Our strategy is beginning to deliver tangible results in line with our expectations. We look forward to Johnny Coca's first Mulberry collection which will emphasise our Britishness and our heritage in leather, whilst delivering great quality within our targeted price range.

“We remain committed to our UK manufacturing base, which produces around 50% of our handbags.”

UK retail sales including digital were up 14% on a like-for-like basis to £40m, while international retail sales were down 3% to £10.4m.

The company said sales in Europe have grown encouragingly, benefitting from both positive LFL growth and new stores, while North America was more challenging.

As far as current trading is concerned, Mulberry said total LFL retail sales for the 10 weeks to 5 December were up 5%.

“Whilst trading for the year to date has grown in line with our expectations, our full year results are dependent on the next few weeks of trading through Christmas and into January,” the company said.

At 1055 GMT, Mulberry shares were down 1.6% to 920p.