British leather goods specialist Mulberry Group Plc has reported a four percent increase in sales and a reduction in losses in its annual results.
The handbag retailer posted sales of £159.1 million (about €184.52 million) for the financial year ended April 1, up from £152.4 million a year earlier, despite ‘macroeconomic uncertainty’.
In its home market of the UK, retail sales fell about one percent to £87.7 million, with the company noting that it was impacted by “the general economic environment” in the first half of the year. In the second half of the year, however, Mulberry was able to improve its performance. The government’s controversial decision to scrap VAT-free shopping for overseas customers impacted domestic sales for the year.
Retail sales in Asia-Pacific rose three percent to £28.9 million despite the region being hit by restrictions, particularly in China and South Korea. International retail sales fell 12 percent to £46.5 million. Digital sales rose two percent to £48.4 million and accounted for 30 percent of total sales.
“We delivered a positive Group result this year thanks to our unique brand identity, our beautiful innovative products and our market-leading omnichannel offering,” said CEO Thierry Andretta.
Investments weigh on profits
Despite the increase in sales, profit before tax (EBIT) fell to £13.2m from £21.3m in the previous year, as the company cited costs for software-as-a-service ( SaaS) and other investments.
“We have made significant investments in the business this year and have expanded our direct customer model with recent acquisitions of companies in Sweden and Australia,” said Andretta. “I am also pleased to announce today that we have now taken full ownership of Own Mulberry Japan Co. Limited.”
The group’s sales for the first 12 weeks of the current year are 6 percent above last year’s level, while retail sales are up 15 percent.
Mulberry added that the new sites in Sweden and Australia “continue to perform well”.
This translated and edited post previously appeared on FashionUnited.uk.