LONDON — Mulberry, the U.K. accessories and fashion brand, posted a net loss of $1.6 million in the first half, due to a slowdown in tourism, a shop closure in Tokyo and increased off-price selling.
In the comparable period last year, the firm registered a $1.5 million loss.
The company said in a statement Thursday that sales in the period ending Sept. 30 had increased by 10 percent to $21 million from $19 million. Half of that increase came from off-price and discounted sales, and the other half from growth in its wholesale accessories business.
All figures are converted from the pound at current exchange rates.
In his first report as chairman and chief executive of Mulberry, Godfrey Davis described the trading climate in the U.K. and northern Europe as "tough and demanding." He also said Mulberry had completed a $1.3 million cost-reduction program, and would now focus on guiding the company back to profitability.
Gross margin fell to 44.1 percent from 54.2 percent a year ago, due, the company said, to the higher proportion of sales made through the off-price business, and to discounting in order to reduce stock. Stock was reduced $1.9 million compared with the corresponding period last year. The closure of Mulberry’s Tokyo store in June added $312,000 to the overall losses.
The outlook for the second half is mixed, Davis said. Sales in the first eight weeks to December 7 are 2 percent higher than last year. Early indications for spring 2003 are "satisfactory" for accessories — which generate 70 percent of group sales — and "disappointing" for clothing.
Davis added that costs linked to Mulberry’s shareholder dispute last month will amount to $1.4 million, and will weigh on the bottom line for the fiscal year ending March 31.
As reported, Davis succeeded Roger Saul last month after Ong Beng Seng and Christina Ong, who hold a 41.5 percent stake in Mulberry, threatened to oust Saul.
Mulberry has had a bumpy financial performance since it went public in September 2000, swinging from booming profits at the time into declining profits and ultimately losses as a result of the weakening economy and a continuing revamp of the brand.
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast