The luxury leather goods group is in serious trouble as they have just issued their fifth profit warning in two years.
The company have announced that trading issues have been worse than expected due to ‘tough conditions in the luxury sector and falling tourist shoppers to its UK stores.’
Mulberry, which makes their handbags in Somerset have seen their sales drop by 17% to £64.7 million, whilst their wholesales have also declined by 31% and retail sales down by 12%. This has resulted in shares within the company dropping by 10% on Tuesday night.
In hope to win back more shoppers, earlier this year Mulberry released a more affordable range within the company named ‘ Tessie.’
Mulberry’s boss Godfrey Davis said, “I think we did make some mistakes. The focus on the higher price point was a mistake. But we have addressed the issues. The UK is looking quite resilient for core customers now.”
“The new products are beginning to reach our shops, with further new product being offered in our shops during November,”
Perhaps Mulberry’s falling level of sales is due to the company operating without a chief executive and creative director. Davis is currently the executive chairman at Mulberry, after Bruno Guillon previously the CEO was ousted for overseeing the share price falling 67% in the two years he had been in charge.
Mr Davis said the company remained “profitable and cash generative”. “Despite the current challenges, I am confident that we will build on Mulberry’s solid foundations and unique growth,” he said.