11th Jun 2015 07:40
LONDON (Alliance News) - British fashion retailer Mulberry Group PLC Thursday reported its third consecutive drop in annual profit in its recently-ended financial year as a decline in sales its wholesale business offset a slight rise in retail revenue, but Mulberry said it expects wholesale to pick up in the current year.
The luxury handbag, clothes and accessories maker reported a drop in pretax profit in the year to March 31 to GBP1.9 million from GBP14 million the prior year, as revenue fell 9% to GBP148.7 million from GBP163.5 million. Revenue came in line with consensus market expectations provided by Mulberry of GBP148 million, but pretax profit fell short of a Barclays forecast of GBP4 million.
A 1% increase in retail sales to GBP109.9 million offset a 29% decline in wholesale revenue to GBP38.8 million, Mulberry said. While retail trading improved following the introduction of its Spring/Summer 2015 collection into its stores last November, the wholesale business continued to struggle.
Geographically, UK retail sales fell 7% in the year, but international retail sales grew 28% and digital sales were up 15%.
Wholesale is expected to stabilise in the current financial year, Mulberry said, supported by the Autumn/Winter 2015 and Spring/Summer 2016 order books, which are "developing satisfactorily".
Mulberry will pay a total dividend of 5 pence for the full year, which is flat year-on-year.
Mulberry added that total retail sales in the 10 weeks to June 6 were up 17%, while like-for-like sales rose 15%.
"We have seen a positive uplift in sales since November as a result of the actions we took at the beginning of the year. We have focused on creating desirable new products across the entire Mulberry range whilst continuing to invest for the longer term. Our initiatives to re-engage with our customers have delivered promising results," Chairman Godfrey Davis said in a statement.
"Under the leadership of Thierry Andretta and the creative direction of Johnny Coca, we look forward to the Mulberry brand fulfilling its global potential," he added.
Chief Executive Thierry Andretta joined the company in April and Johnny Coca will commence in his role as creative director on July 8.
Shares in Mulberry were trading flat at 905.00 pence at the open on Thursday.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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