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Mulberry - Gross margins soar 8.1%!

August 2022

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

Mulberry, best known for its leather handbags designed by Alexa Chung, grew revenues 32% year-on-year to £152.4m, mainly thanks to the UK (+37%), Asia Pacific (+30%) and Rest of World (+22%) as the launch of its new Softie bag family and relaunch of Alexa bags bore fruit. Underlying pretax profit was £15m, up from £5m, while net cash soared from £11.8m to £25.7m. The most eye opening aspect of Mulberry’s full year results was its gross margins soaring by 8.1% to 71.7%, thanks to a strategic focus on full price sales and increased volume efficiencies while Mulberry has benefited from its UK-based manufacturing, insulating it from supply chain disruptions. By channel, retail stores grew 92% while online declined 15% due to to ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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