Profits at Mulberry Group plc nearly tripled to 4.9 million pounds, or $9 million, from 1.7 million pounds, or $3.1 million, thanks to a strong surge in leather accessories sales in the fiscal year ending March 31.
LONDON — Profits at Mulberry Group plc nearly tripled to 4.9 million pounds, or $9 million, from 1.7 million pounds, or $3.1 million, thanks to a strong surge in leather accessories sales in the fiscal year ending March 31.
Sales rose 44.3 percent to 43.4 million pounds, or $79.4 million, from 30.1 million pounds, or $55.1 million, the company said in a statement Thursday. All figures have been converted at current exchange.
Ninety percent of those sales came from accessories, chiefly leather handbags. The remaining 10 percent came from the company's small but growing ready-to-wear collection.
Mulberry, which is controlled by the Ong family and listed on London's secondary AIM stock exchange, also will pay its first dividend since 1988 — 1 penny, or $0.02, a share.
"It's great news for the whole team," said Lisa Montague, Mulberry's chief operating officer. "The rise in profits came mostly from an increase in sales — and a more efficient retail business."
Montague added that markets showing the most dynamic growth were the U.S., southeast Asia and Japan, which generated about 30 percent of total sales in the period.
"For so long, Mulberry had been northern European-focused, which is why we're now seeing results from these new booming markets," she said. Currently, about 55 percent of sales come from retail channels, and 45 percent come from wholesale.
As reported, Mulberry is finalizing the details of a lease on Melrose Place in Los Angeles, where it will open an accessories unit this year.
It already has a store on Bleecker Street in Manhattan, and there are three more U.S. units in the works.
The brand also has just opened a store in Oslo, and plans to open shops in Singapore, Seoul, Istanbul and at Dubai's Villa Moda this year.
The company's strategy in emerging markets such as Turkey and Korea has been to team with retail partners to open franchises.
Looking ahead, the Mulberry statement said U.K. retail sales in the first 11 weeks of the current fiscal year are up 19 percent, with fall 2006 wholesale orders 12 percent ahead of the previous year.Montague said the number-one seller for Mulberry has been the Anthony, a small messenger bag originally aimed at men, but which has become popular with women, too.
The bag retails for $325 in the U.S., and in terms of units sold, it's been far outstripping other Mulberry bestsellers such as the Bayswater and Roxanne bags.
"The success of our men's bags has come as a surprise. In the U.K., we now have 7 percent of the overall men's bag market," Montague said.
On Thursday, the company also said it has made space at its Somerset, England, factory to increase U.K. production of premium leather bags.
"We really wanted to protect our 'Made in the U.K.' products, which we think is essential if you're making luxury goods. The average age of our factory workers now is 53, so we've decided to create our own labor pool," said Montague.
"In August, we'll be taking on 10 apprentices, and we're hoping to increase our U.K. production capacity by 60 percent over the next two years."
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