MULBERRY GROUP (MUL) H1 2025 earnings summary

Executive summary

• Group revenue declined 19% year-over-year to £56.1m, with UK retail sales down 14% and Asia-Pacific retail sales down 31%.

• Gross margin fell to 66.5%-67% from 70%-70.4%, mainly due to inventory optimization and promotional activity.

• Operating expenses were reduced by 16% to £50.7m, reflecting cost management efforts.

• Underlying loss before tax widened to £15.3m from £12.3m, with reported loss before tax at £15.7m.

• Andrea Baldo was appointed CEO in September 2024, bringing international luxury experience and leading a strategic review.

Financial highlights

• UK retail sales decreased 14% to £31.2m; Asia-Pacific retail sales dropped 31% to £9.3m.

• Franchise and wholesale sales declined 46% year-over-year.

• Digital sales accounted for 33% of group revenue, up from 29% last year.

• Net working capital reduced to £10.9m (2023: £34.6m), mainly from a £20.2m inventory reduction.

• Net borrowings at period end: £16.4m (2023: £13.5m); available liquidity: £5.7m.

Outlook and guidance

• Trading for the full year is expected to be weighted to the second half, with festive trading critical.

• Management is focused on operational efficiency, product, pricing, and distribution strategies to improve margins and cash position.

• Ongoing cost actions and inventory management to align with revenue expectations.

• Board remains confident in a path back to profitability, supported by new capital and CEO's strategy.

• Ongoing macroeconomic uncertainty and inflationary pressures continue to challenge performance.