EMMA Hill, the highly-regarded creative director of Mulberry, is set to leave after more than five years with the luxury goods maker, sending shares in the group tumbling.
Since joining in 2008, Hill has been credited with turning the Somerset-based firm from a trusted briefcase and wallet maker into an international fashion powerhouse with a clutch of celebrity fans.
Profits have risen sharply in recent years as television presenter Alexa Chung and singer Lana Del Rey lent their names to its best-selling designs, but results this week are expected to show a drop in earnings following a slowdown in tourist spending at its London stores.
Shares in Mulberry sank 87p, or 8.2 per cent, to 980p yesterday after it said Hill, awarded a CBE for services to the fashion industry last year, wanted to leave.
In a brief statement, the firm said: “Emma has informed the company that she wishes to leave after a very successful period at Mulberry, during which she has built a strong and talented creative team.
“The timing of her departure is currently under discussion and has yet to be finalised.”
Mulberry said that its main spring/summer collection for 2014 had been completed and that Hill was continuing to work in the business, putting the finishing touches to its London Fashion Week collection, which is due to be launched in September.
The group is headed by chief executive Bruno Guillon, who joined in March last year after a decade with French luxury brand Hermès, including four years as managing director.
At the time of his appointment, Hill said she and Guillon “share the same vision for the brand”, but reports yesterday suggested that her departure followed disagreements with management over creative and operational strategy. A spokeswoman declined to comment on the claims.
Mulberry is tipped by City analysts to report a pre-tax profit of about £26 million for the year to the end of March, down from £36m the previous year, when it publishes its annual figures on Thursday.
In a trading update in March, the firm said trading over Christmas had been weaker than expected, with “disappointing” sales at its retail stores, while revenues from its wholesale operation were predicted to fall about 15 per cent compared with last year.
However, investors will be hopeful the firm can regain momentum after better results from other luxury goods brands.
Despite fears of a slowdown in spending among well-heeled Chinese consumers, rival Burberry recently posted a 14 per cent gain in full-year adjusted pre-tax profits to £428m as strong demand for its more expensive products in China helped it beat sales forecasts.
Investec analyst Philip Dorgan said he believes Mulberry is “pausing for breath” as it lays the foundations for future growth.
He said: “The product quality improvements together with new product launches suggest that the company is positioning itself well and will, over time, strongly appeal to the key Asian and North American markets.”