The luxury brand Mulberry reports increased losses and plans a strategic overhaul under new CEO Andrea Baldo.
- Mulberry’s losses for the half-year widen to £15.7 million, reflecting a challenging period.
- Sales have decreased by 19% to £56.1 million, signaling the need for change.
- CEO Andrea Baldo outlines initiatives to revitalize the brand, starting with UK consumers.
- Despite challenges, Mulberry rejects a takeover bid, signaling confidence in potential recovery.
Mulberry has announced a significant increase in its half-year losses, reporting a figure of £15.7 million for the 26 weeks ended in late September. This marks a rise from the £12.8 million reported for the same period in the previous year. The company’s sales have also suffered, declining by 19% to reach £56.1 million. This financial downturn has prompted new CEO Andrea Baldo to emphasize the urgency of reprioritizing and rebuilding the business.
Baldo, who has been leading Mulberry for under three months, acknowledged the pressing need to invigorate the brand’s relevance, starting with its UK market before expanding efforts internationally. This approach aims to counteract the difficult economic conditions that have affected the luxury sector, as seen with other brands like Burberry experiencing profit declines.
In response to current market challenges, Mulberry has implemented several strategic measures. The company is focusing on streamlining operations to enhance efficiency and profitability. This includes reviewing internal structures, which might lead to job losses, and making calculated adjustments to product, pricing, and distribution strategies.
Amidst these internal changes, Mulberry has also navigated external pressures. Recently, the company successfully resisted a takeover attempt by Mike Ashley’s Frasers Group, despite a substantial cash offer. Mulberry’s board, backed by majority shareholder Challice, rejected the bid, expressing no interest in selling its shares or allowing Frasers any influence over future offers.
Frasers Group, which holds a 37% stake in Mulberry, voiced frustration over the decision and suggested concerns regarding Mulberry’s governance and current financial strategy. Nevertheless, it has called for representation on Mulberry’s board, reflecting its investment interest and desire to influence the company’s strategic direction.
Despite financial challenges, Mulberry remains focused on revitalizing its position in the luxury market.
