Mulberry hit by slowdown in luxury spending
Mulberry has seen its festive revenue fall by 8.4% after being hit by a slowdown in luxury spending by consumers.
In the 13 weeks to 30 December, retail sales dropped by 1.5%% following a 3.9% uplift in international sales and a 4% decline in sales in the UK.
However, the company maintained its full price sales approach in the period.
Thierry Andretta, chief executive of Mulberry, said: “In the run-up to Christmas, the macro-economic environment continued to impact consumer spending in the luxury retail sector, which Mulberry was not immune from. Despite this, the group maintained its discipline and focus on a full price strategy against an unusually high promotional environment.
“Our international sales remained positive, supported by our strategy to bring in-house ownership of overseas stores. In the UK, we continue to believe the lack of VAT-free shopping is impacting the retail landscape, as well as the hospitality, leisure and tourism sectors.”
The Christmas trading results meant that group revenue for the 39 weeks ended 30 December edged up 0.1% year-on-year with gross margins in line with the first half of the year.
Mulberry has previously said its full year results will be impacted by additional operational costs of new stores in Sweden and Australia and ongoing investment in technology to support future growth.
Looking ahead, Andretta said: “We are continuing to execute our plans and remain confident that our investments will underpin future sustainable growth.”