LONDON — Mulberry Group saw sales and profits climb in fiscal 2016-17 following a series of changes aimed at cozying up to customers, working more efficiently and clarifying its digital sales and marketing pitch in the Far East.
In the 12 months ended March 31, profits climbed 85.8 percent to 5 million pounds, or $6.6 million, as revenue rose 7.8 percent to 168.1 million pounds, or $220.2 million.
The company said it ended the year with a cash balance of 21.1 million pounds, or $26.8 million, and no debt.
Dollar figures have been converted at average exchange for the periods to which they refer.
The brand, which produces 50 percent of its leather goods in England, said its new joint venture in Asia is operational with web sites in China and Korea launching later this summer in local languages and currencies.
Until now, those markets were reading about Mulberry products in English only and paying for their orders in U.S. dollars and British pounds.
Late last year the company formed a new company, Mulberry (Asia) Ltd., to operate its business in China, Hong Kong and Taiwan. The company is a joint venture with Challice Ltd., the division of Club 21 that owns a majority stake in the publicly quoted Mulberry.
“From our point of view, it was a good year,” said chief executive officer Thierry Andretta. “The JV is up and running and we’ll be looking to do local fulfillment in China in the next fiscal year.”
As part of the Asia venture, Mulberry has already opened a shop at the IFC in Hong Kong and at Plaza 66 in Shanghai. It is also planning to move its Beijing store to a better location.
Andretta is implementing more new strategies in the current year: Mulberry was one of the first British brands that had attempted to shrink the window between showing and delivering its collections, and as of the spring2018 season it will be shifting into full see-now-buy-now mode.
As reported, the brand plans to sell that collection to buyers in September, under embargo, and then show it on the runway at London Fashion Week in February.
“We’re now looking at the digital generation — and that’s not only the Millennials. We’re looking at consumers who don’t want to wait four or five months to buy what they see on the runway,” Andretta said following Wednesday’s announcement. “They want immediacy, especially from a company like ours with accessible luxury price points.”
Andretta added that the spring 2018 campaign and full merchandise offer will launch together after the show, similar to Burberry’s take on see-now-buy-now.
As part of its store rollout in the current year, Mulberry is also planning to take over the former Austin Reed space, on Regent Street in London, diagonally opposite the Burberry flagship.
The 2,500-square-foot space will span the ground and lower ground floors and will showcase the new store concept that’s currently being developed by creative director Johnny Coca. Andretta said the opening will likely be at the end of the current calendar year, which finishes in March 2018.
All those plans are rolling ahead despite a modest start to the current year.
In the 10 weeks to June 3, retail like-for-like sales were up 1 percent. In the U.K., like-for-like retail sales advanced 2 percent, and the company said the brand continued to benefit from an increase in tourism to the U.K. and the weak pound, although domestic demand has been “softer.”
Mulberry said that international like-for-like sales in the first weeks of the current fiscal year showed a weakening in “non-stragetic” locations, with management continuing to focus on the “optimization” of the store network. To wit, Mulberry recently closed its store in Washington, D.C.
Thierry was sanguine about the slow start to the year. He pointed out that the period is usually a slow one, and there was no new product landing on the shop floor during those ten weeks. The last product drop was in February.
He also said the snap general election (which took place last week) and two terrorist attacks in the U.K. within weeks of each other impacted footfall and sales.
New fall items have only begun arriving this week, and Andretta said he’s confident about the collection.
One of the new items is the Amberley bag, which the cross-dressing sculptor and potter Grayson Perry showed off during an event with Mulberry at the Serpentine Gallery in London last week.
In a report following the results, Barclays said Mulberry has made “real progress” on product and factory efficiency, which led to a much higher gross margin than the bank had expected in the second half.