Handbag maker Mulberry sees shares skyrocket after surge in sales in UK and Asia after rebounding in luxury demand


Handbag maker Mulberry sees shares skyrocket after surge in sales in UK and Asia after rebounding in luxury demand

  • Global sales increased 34% to £ 65.7m in the six months to 30 September
  • Pre-tax profits came in at £ 10.2m compared to a loss of £ 2.4m last year
  • The end of the lockdown enabled a 139% increase in UK in-store purchases


Handbag maker Mulberry’s shares rose 22.5 per cent today after reports that a rebound in demand for luxury goods increased sales.

Mulberry’s revenues are up 34 per cent compared to the 2020 level, with stores reopening worldwide, delivering £ 65.7 million in sales in six months to 30 September.

And with pre-epidemic sales – which fell to £ 48.9 million at the same time last year – pre-tax profits amounted to £ 10.2 million, compared with a loss of £ 2.4 million last year.

Luxury handbag maker plans to return to Paris ‘once international tourism returns’

However, profits were boosted by a one-off £ 5.7 million injection of its Paris lease at the closure of the high-end Rou Saint-Honor in July in response to a slowdown in tourism.

UK sales growth jumped 36 per cent to £ 38 million, including 139 per cent of bounce in-store purchases, while Asia Pacific sales rose 23 per cent to £ 11.8 million.

Earlier this month, Consultancy Bain predicted that the luxury goods sector would be recovering from a health crisis this year because of high spending in the US and China, especially on high-end shoes, leather goods and jewelry.

This helped offset the lost sales due to the absence of tourists in the UK and the rationalization of stores in Europe.

However, Mulberry does not give up on Paris and plans to open a new store in the French capital once ‘international tourism returns in a place that supports the company’s omni-channel approach and enhances its customer-centric retail experience’.

Meanwhile, the rest of the world’s sales rose 7 per cent to £ 5.8 million.

Mulberry said its economic performance during the half-year reflects ‘the benefits of the measures we took during the epidemic and the strong consumer response to the group’s product’.

Many other firms have recently reported struggles with well-publicized supply chain issues, saying the company’s combination of its ‘UK factories, careful planning and agile supply chains’ has enabled it to ‘navigate’ the worst problems. This will affect the fulfillment of our sales channels.

Its focus on full-price items, shifting away from discounts, helped profit margins improve from 59 percent to 69 percent over the period.

Since October 30, Mulberry’s revenues have increased by 35 per cent over the same period last year, and the company expects second-half gross margins to be ’67 per cent or more’.

CEO Thierry Andretta said: ‘Our long-term strategy, namely our innovative and sustainable products made in our Carbon Neutral Somerset factories, our market-leading omni-channel distribution model and our expansion into Asia Pacific have delivered strong financial performance.

‘The bold decisions we have taken to focus on our UK manufacturing capabilities mean that we are well positioned for the festive trading period and beyond.’

Mulberry shares were up 22.5 percent at 370p in mid-day trading, bringing their value to more than 25 percent above pre-Covid levels.

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