Mulberry: UK retail sales suffer but grow 20 percent abroad
By Prachi Singh
13 Jun 2018
The Mulberry Group said that it made progress during the year with profit from its business in the UK, Europe, North America and wholesale increasing by 36 percent to 11.3 million pounds (15 million dollars), which the company added, reflected a focus on new products and network optimisation. Group revenue grew by 1 percent to 169.7 million pounds (226 million dollars) as the group focused on full price sales, new products and rolling out digital and omni-channel enhancements across the global network.
Group retail sales increased 3 percent to 132 million pounds (176 million dollars), while within this, UK retail sales were broadly flat at 106.3 million pounds (141.8 million dollars) compared to 106.8 million pounds (142.4 million dollars), last year. International retail sales increased 20 percent to 25.7 million pounds (34 million dollars). Global digital sales increased by 14 percent to 29 million pounds (38.6 million dollars), accounting for 17 percent of group revenue.
Update on Mulberry’s retail store network
The company added that there were 69 directly operated stores at the end of the year compared to 67 stores last year, while the international store network was enhanced and expanded with a focus on Asia.
A store in Hong Kong was relocated within Harbour City to Ocean Centre and became part of group retail sales from April 2017, a new store was opened in Shanghai Plaza 66 and the store in Beijing China World was relocated. The outlet store in Tianjin was acquired in March 2018 by Mulberry Asia and these stores became part of the group's retail sales from that date. In Taiwan, a store in Breeze was acquired in October 2017 and became part of the group's retail sales.
Reported profit before tax, for the year, after the new business costs relating to Asia, was 6.9 million pounds (9 million dollars).
Mulberry’s wholesale revenues for the year drop 5 percent
Wholesale revenue, comprising sales to partner stores and selective multi-brand wholesale accounts, reduced by 5 percent to 37.7 million pounds (50 million dollars), which the company said was primarily due to the transition of China and Hong Kong to own retail and preparation for a new business arrangement in South Korea.
The partner store network at the period end totalled 45 stores in Asia Pacific, Europe and the Middle East. Franchise partners closed seven non-strategic stores in Asia Pacific. Four stores in China, Hong Kong and Taiwan, which were open as at 31 March 2017, were transferred to the group's retail portfolio as part of the new majority-owned subsidiary, Mulberry (Asia) Limited.
In addition, five new stores were opened in Japan as part of the preparation phase for Mulberry Japan in collaboration with Onward Global Fashion. These stores have been acquired by Mulberry Japan following the end of the financial year ending March 31, 2018.
Additionally, the group agreed with its longstanding partner, SHK Holdings Limited to form a new majority owned entity to operate its business in South Korea. Current network consists of 18 points of sale including concessions, outlets and duty-free. Mulberry added that Korean mulberry.com site and omni-channel platform will form part of the new business.
Like-for-like retail sales including digital were down 7 percent for the 10 weeks to June 2, 2018 with UK retail down 9 percent and international retail up 1 percent. Digital sales increased by 14 percent in the year to March 31, 2018 and increased by 5 percent in the 10 weeks to June 2, 2018.