LONDON — Mulberry, the British accessories brand, said profits and sales rose in the six months ended Sept. 30.
This story first appeared in the December 11, 2009 issue of WWD. Subscribe Today.
And the momentum has continued into the fall, the company said, with U.K. retail sales in the 10 weeks to Dec. 5 rising 47 percent above the corresponding period last year, when sales were down 12 percent. In addition, there will be no discounting in the runup to Christmas.
Chairman and chief executive officer Godfrey Davis said a combination of strong sales at Mulberry’s stand-alone shops and stronger-than-expected wholesale demand contributed to the growth.
“On the basis of current trends, it is expected that the financial performance for the year will be substantially ahead of market expectations and ahead of last year,” he said.
Profits in the period climbed 15 percent to 1 million pounds, or $1.6 million, from 893,000 pounds, or $1.4 million. Sales rose 16.2 percent to 32.3 million pounds, or $51.3 million, from 27.8 million pounds, or $44.2 million. All figures have been converted at average exchange rates for the period.
A spokeswoman said Mulberry had kept a close eye on inventories this season, and there is very little surplus stock from the autumn. Wholesale orders for fall were down 5 percent compared with last year, while spring orders are flat against those of the previous year.
“I think the results surprised the management team as much as they surprised us,” said David Stoddart, retail analyst at Altium Securities.
He said during the past six months, the company benefited from a variety of factors and trends, including lower interest rates in the U.K., tourists taking advantage of the pound, and the popularity of the Mitzy bag range, the entry price of which is about 100 pounds, or $163, lower than that of the best-selling Bayswater bags. The opening price for a Mulberry bag is about 200 pounds, or $326, while the average price is 500 pounds, or $815.
Stoddart also pointed out turnover at the brand’s Bicester Village outlet store outside London nearly doubled earlier this year when the mall was extended. The brand, he said, is also a top performer at the Westfield shopping mall and at Harrods and Selfridges.
Mulberry has also been aggressive in introducing items with lower entry prices, including key chains and London Underground cardholders. Last month, the brand teamed with Apple to launch a collection of leather satchels, bags and pouches for Mac Books, iPhones and iPods.
Mulberry has 18 stand-alone stores in the U.K., and an additional five airport stores. Worldwide, it has 300 doors, including concessions and wholesale outlets. Bestsellers include the Bayswater, Daria and Mitzy ranges. Sales on the brand’s Web site now account for 7 percent of overall sales.