UK's Mulberry reaffirms $256 mn revenue target despite FY25 headwinds

In the UK, retail and digital revenue dropped 20 per cent, impacted by reduced consumer spending amidst economic uncertainty. North American retail revenue declined just 1 per cent, supported by the full-year trading of new Nordstrom stores and the launch of a Nordstrom online concession.

The group reported an underlying loss before tax of £23.7 million, primarily due to reduced revenue and stock optimisation efforts. The reported loss before tax improved slightly to £31.8 million from £34.1 million in FY24, aided by operating cost savings that are expected to carry into the current fiscal (FY26), Mulberry said in a press release.

The gross margin of the company fell to 66.8 per cent, down from 70.1 per cent in FY24, as inventory optimisation initiatives involved significant promotional and markdown activity, along with a shift in the wholesale customer mix.

In September 2024, Mulberry raised £10.35 million through a new share issue to strengthen its balance sheet and enhance financial flexibility during the strategic shift and turbulent market conditions in the second half (H2) of FY25.

Despite the tough environment, Mulberry remains cautiously optimistic about FY26. Trading in the first nine weeks of the new fiscal has aligned with the board’s expectations. Total group revenue declined 18 per cent, primarily due to planned store closures, but like-for-like retail and digital revenue fell by only 5 per cent. Notably, full-price sales outperformed YoY in both the UK and North America, signalling improving consumer engagement.

The group’s digital channel via the official site of Mulberry continues to show strong performance, reinforcing the strength of its direct-to-consumer (DTC) strategy. The wholesale division is positioned for growth, with Spring/Summer 2026 orders showing double-digit gains over the previous year, bolstered by new leadership and partnerships with Harvey Nichols and Liberty.

Key product families like Bayswater and Mini Bags maintained solid demand. Following the launch of its new brand campaign ‘A Return to Somerset’, Mulberry has reaffirmed its strategic focus on full-price sales, brand desirability, and operational efficiency.

“We have made significant progress in laying the foundations for Mulberry’s turnaround. Since launching our ‘Back to the Mulberry Spirit’ strategy in January, we have acted at pace to simplify the business, reduce costs, and refocus on our most profitable channels and markets. This is an ambitious transformation, underpinned by operational discipline and a commitment to placing creativity at the heart of everything we do,” said Andrea Baldo, chief executive officer (CEO) at Mulberry Group. "At the same time, we are reinvigorating the brand to reassert its cultural relevance and emotional resonance with customers. The launch of our new campaign, ‘A Return to Somerset’, marks an important milestone, celebrating our roots, values and the distinct British voice that defines Mulberry.”

Looking ahead, the group reaffirmed its mid-term goal of surpassing £200 million (~$256 million) in annual revenue and achieving an adjusted EBIT margin of 15 per cent, underpinned by its renewed strategy and ongoing commitment to disciplined execution, the release stated.

ALCHEMPro News Desk (SG)