Better profits in the bag for Mulberry

Handbag maker Mulberry is flagging market-topping profits as it begins to recover from an ill-fated push further upmarket.

Mulberrys bid to make its offering even more exclusive backfired

The British group has spent the past year realigning its product offering after a move to a more exclusive luxury position backfired, prompting a series of profit warnings and the departure of boss Bruno Guillon.

In a trading update yesterday, Mulberry said its spring/summer collection, which included a strengthened £500-800 bag range, had delivered a much improved sales performance since November, with retail revenue for the year expected to be up 1 per cent.

However, the rise will be “more than offset” by a decline in wholesale revenue, it added.

The firm said cost controls would still put profit before exceptional items slightly ahead of market hopes. According to data from Reuters, analysts are on average expecting a pre-tax profit of £4.7 million, down 66 per cent on the year before.