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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Mulberry Group Plc | AQSE:MUL.GB | Aquis Stock Exchange | Ordinary Share | GB0006094303 |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 120.00 | 110.00 | 130.00 | 120.00 | 120.00 | 120.00 | 0.00 | 06:55:41 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2019 to Apr 2024
TIDMMUL
RNS Number : 5838I
Mulberry Group PLC
10 December 2015
MULBERRY GROUP PLC ("Mulberry" or the "Group")
RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2015
Mulberry Group plc, the English luxury brand, announces its results for the six months ended 30 September 2015.
FINANCIAL HIGHLIGHTS
-- Total revenue up 5% to GBP67.8 million (2014: GBP64.7 million) -- Gross profit margin increased by 1.6% to 61.5% (2014: 59.9%) -- Profit before tax GBP0.1 million (2014 Loss before tax: GBP1.1 million)
OPERATING HIGHLIGHTS
-- Digital sales increased by 20%, representing 12% of Group sales (2014: 10%) -- Efficiency gains in our UK factories which now produce c. 50% of our handbags
CURRENT TRADING AND OUTLOOK
-- Total Retail sales for the 10 weeks to 5 December were up 4% (like-for-like up 5%) -- 2015 Christmas video #MulberryMiracle has been viewed over 1.7 million times
-- New Creative Director, Johnny Coca, will show his first Mulberry collection as part of London Fashion Week during February 2016
THIERRY ANDRETTA, CHIEF EXECUTIVE OFFICER, COMMENTED:
"Our strategy is beginning to deliver tangible results in line with our expectations. We look forward to Johnny Coca's first Mulberry collection which will emphasise our Britishness and our heritage in leather, whilst delivering great quality within our targeted price range. We remain committed to our UK manufacturing base, which produces c. 50% of our handbags. We are excited about the future and look forward to the Mulberry brand fulfilling its potential both in the UK and internationally."
FOR FURTHER DETAILS PLEASE CONTACT:
Bell Pottinger Daniel de Belder 020 3772 2561 / 07977 927142 Mulberry Investor Relations Allegra Perry 020 7605 6795 Altium Sam Fuller / Tim Richardson 020 7484 4040 Barclays Nicola Tennent 020 3134 9801
Copies of this Half Year Report are available from the Group's registered office and from its website www.mulberry.com.
FINANCIAL REVIEW
Sales continued to grow during the six months to 30 September 2015 and the profit before tax was ahead of the prior year period.
Total revenue for the period was GBP67.8 million, up 5% from GBP64.7 million last year, reflecting growth in Retail sales which was partially offset by the expected decline in Wholesale sales. Trading in our own Retail stores continued to grow encouragingly throughout the period.
Retail
Retail sales have continued to grow following the momentum gained during the second half of the year to March 2015. Retail sales (including Digital) increased 12% (GBP5.3 million) to GBP50.4 million during the period, with like-for-like sales up 10%.
-- UK Retail sales (including Digital) were up 12% (like-for-like up 14%) for the period to GBP40.0 million (2014: GBP35.8 million);
-- International Retail sales (including Digital) were up 12% (like-for-like down 3%) for the period to GBP10.4 million (2014: GBP9.3 million). Sales in Europe have grown encouragingly, benefitting from both positive like-for-like growth and new stores, whilst North America was more challenging; and
-- Digital sales were up 20% to GBP7.9 million, accounting for 12% of Group sales (2014: 10%); 77% of our Digital sales were generated in the UK and 46% of revenues were generated through orders placed via mobile phones or tablets.
Wholesale
As anticipated, Wholesale sales declined by 11% to GBP17.4 million (2014: GBP19.6 million), reflecting conservative ordering by our Asian partners as well as our own efforts to increase control over distribution to independent retailers. We expect the sales trend to continue for the short term as our partners await the arrival of the new collections from Johnny Coca and we continue to optimise our network.
The franchise network at 30 September 2015 included 57 partner stores in Asia and Europe (2014: 51).
Financial
Gross margin for the six months to 30 September 2015 increased by 1.6% to 61.5% (2014: 59.9%), reflecting the increased proportion of sales generated in our own Retail stores and the efficiency improvements achieved in our UK factories in Somerset.
Net operating expenses for the period increased by GBP1.7 million to GBP41.7 million (2014: GBP40.0 million), reflecting an increase in net Retail costs for stores opened/closed (GBP1.6 million) and additional senior management (GBP1.2 million), partially offset by reduced advertising and promotion costs due to the phasing of spend (GBP0.7 million) and other cost reductions (GBP0.4 million). In addition, an exceptional profit was recorded on the sale of the leases of two stores, which was offset by the impairment of one directly-operated store and the write down of our contribution to a partner store that was closed after the period end.
Profit before tax was GBP0.1 million (2014 Loss before tax: GBP1.1 million).
The effective tax rate for the full year is expected to decline to 48% (2014: 63%) as a result of a reduction in the European and Canadian losses that cannot be offset against increasing UK profits.
Capital and investment expenditure for the period was GBP2.1 million (2014: GBP12.0 million), of which GBP1.3 million related to new stores and GBP0.5 million to investment in digital and IT systems.
The improvement in factory efficiency is in part responsible for the increase in inventories to GBP47.7 million from GBP39.4 million at the start of the period. October wholesale shipments were GBP3.0 million higher than last year which enables our partners to have more time to sell the SS16 collection.
The Group had cash of GBP4.1 million at 30 September 2015 (2014: GBP3.6 million) which includes the GBP3.6 million received from the disposal of the two stores.
OPERATING REVIEW
Product and Design
During the last eighteen months, our priority has been to focus on regaining momentum within our single largest category, women's handbags. This strategy is proving successful and looking forward, we will apply the same approach across all product categories to reinforce the brand's British lifestyle image.
Our new Creative Director, Johnny Coca, joined Mulberry during July and has been working closely with the design and product development teams to prepare the AW16 collection. During the period, we have taken the opportunity to build our design team by hiring new talent with specialist skills in order to enhance the important and complementary categories of men's bags, small leather goods, women's shoes and ready-to-wear. In particular, we are focusing upon delivering Mulberry style and quality whilst adhering to our well defined price positioning strategy.
We look forward to showing the first Mulberry collection under Johnny Coca's creative direction at London Fashion Week during February 2016. These ranges will reach our distribution network during June 2016.
Brand and Marketing
We continue to invest in digital marketing and have upgraded our website www.mulberry.com. Through an increased use of stories, film and stronger visual aesthetic, the site aims to communicate our rich brand heritage and connect with our customers.
We have followed the success of last year's tongue in cheek Christmas video with a new offering for 2015 in our uniquely British way. The video, #MulberryMiracle, has been viewed over 1.7 million times. Our collaboration with Georgia May Jagger enabled us to reach new customers, whilst increasing our social media followers.
Distribution
Our distribution strategy is to expand the business internationally as an omni-channel brand with well-placed stores complemented by a strong digital offering. A large proportion of our North American and European stores have been opened relatively recently and so in the short to medium term we will focus upon improving their productivity with limited new store openings. We will continue to refine our wholesale distribution focussing upon franchise partners and brand enhancing department stores.
During the period, we opened a flagship store in Paris (and closed our smaller store) and closed two directly-operated stores in San Francisco, California and Short Hills, New Jersey. Our partners opened three stores in Macau, Jakarta and Singapore whilst closing one store in Kuwait. At 30 September 2015 Mulberry's global store footprint was 122 stores, including directly-operated and partner stores.
Operations
We have continued to invest in our two UK factories which employ c. 600 people and have achieved significant improvements in efficiency over the past 12 months. They are working at full capacity, deliver on time and produce c. 50% of our handbags.
We have continued to develop our IT systems during the first half and have implemented further enhancements to our omni-channel capability including the integration of digital, in-store sales and customer data in our UK directly-operated stores.
CURRENT TRADING AND OUTLOOK
Total Retail sales for the 10 weeks to 5 December 2015 were up 4% relative to the same period last year (like-for-like up 5%). Retail sales have continued to grow in the second half but the comparatives are tougher as our strategy had started to take effect in the second half of last year. This was driven by strong growth in our Digital business where sales increased by 18%. Digital contributed to the continued strong performance of the UK where total Retail sales (including Digital) during the 10 weeks rose by 6% (like-for-like up 6%).
(MORE TO FOLLOW) Dow Jones Newswires
December 10, 2015 02:00 ET (07:00 GMT)
Whilst trading for the year to date has grown in line with our expectations, our full year results are dependent on the next few weeks of trading through Christmas and into January.
Hot Features
Premium
Retail total sales Retail like-for-like
sales*
26 weeks 10 weeks 26 weeks 10 weeks
This year vs. last to 30 Sep to 05 Dec to 30 Sep to 05 Dec
year (%) 15 15 15 15
UK Retail ** +12% +6% +14% +6%
International Retail
** +12% -6% -3% +1%
----------------------- ----------- ----------- ----------- -----------
Total Retail +12% +4% +10% +5%
----------------------- ----------- ----------- ----------- -----------
* Like-for-like defined as the year-on-year change in sales from stores which have been trading both during the current and previous periods
** Regional splits include digital sales
***Digital sales rose by +20% in the 26 weeks to 30 Sep 2015 and by +18% in the 10 weeks to 5 Dec 2015
Consistent with our strategy to build on our British lifestyle image across all of our collections, there will be an increased investment in designing, developing and launching our AW16 collections during the six months to 31 March 2016. These collections will reach our Retail and Wholesale networks during June 2016 which falls within our next financial year ending 31 March 2017.
Women's ready-to-wear and shoes are a very small proportion of our sales but have potential for growth in the future and are an important factor in building the lifestyle image that will help develop Mulberry internationally. After careful analysis, we have concluded that licensing the manufacture and distribution of these categories will enable us to deliver best in class quality whilst achieving our target price range. We have signed a letter of intent with high quality third party partners who have been selected based upon their proven track record in the luxury industry.
Since the end of September we have reopened our directly-operated store in Stansted Airport following the redevelopment of the terminal and will be relocating our store in Westfield White City to a larger and improved location on 11 December. We have also opened one partner store in Abu Dhabi.
We continue to focus upon improving the productivity of our existing stores. Omni-channel remains a priority with continued investment planned during this financial year to enhance the UK offering and to roll-out these services to key international markets. During November, we launched our local language website in Germany. In addition, we will soon be rolling out the omni-channel offer to our directly-operated stores in Europe.
Operating costs will increase during the second half, reflecting the additional design and product development costs as explained above, the costs of new stores opened both this year and last year, as well as the costs relating to the new senior management team.
Capital expenditure for the full year to 31 March 2016 is expected to be in the region of GBP9.0 million (2015: GBP17.0 million), of which the majority will be on stores.
Consolidated income statement
Six months ended 30 September 2015
Note Unaudited Unaudited Audited
six months six months year ended
30 Sept 30 Sept 31 Mar 2015
2015 2014 GBP'000
GBP'000 GBP'000
Revenue 67,768 64,700 148,680
Cost of sales (26,083) (25,950) (58,745)
Gross profit 41,685 38,750 89,935
Other operating expenses (42,077) (40,127) (85,932)
Exceptional operating income 4 1,078 - -
Exceptional operating expenses 5 (942) - (2,662)
-------------------------------- ----- ------------ ------------ -------------
Operating expenses (41,941) (40,127) (88,594)
Other operating income 198 159 359
Operating (loss)/profit (58) (1,218) 1,700
Share of results of associates 128 100 190
Finance income 2 13 17
Finance expense (12) (5) (46)
Profit/(loss) before tax 60 (1,110) 1,861
Tax credit/(charge) 6 60 700 (3,253)
Profit/(loss) for the period 120 (410) (1,392)
============ ============ =============
Attributable to:
Equity holders of the parent 120 (410) (1,392)
============ ============ =============
Basic earnings/(loss) per
share 9 0.2p (0.7p) (2.3p)
Diluted earnings/(loss) per
share 9 0.2p (0.7p) (2.3p)
All activities arise from continuing operations.
Consolidated statement of comprehensive income
Six months ended 30 September 2015
Unaudited Unaudited Audited
six months six months year ended
30 Sept 30 Sept 31 Mar 2015
2015 2014 GBP'000
GBP'000 GBP'000
Profit/(loss) for the period 120 (410) (1,392)
Exchange differences on translation
of foreign operations (218) (436) (1,084)
Tax impact arising on above
exchange differences 44 89 (137)
------------ ------------ -------------
Total comprehensive expense
for the period (54) (757) (2,613)
============ ============ =============
Attributable to:
Equity holders of the parent (54) (757) (2,613)
============ ============ =============
Consolidated balance sheet
At 30 September 2015
Unaudited Unaudited Audited
30 Sept 30 Sept 2014 31 Mar 2015
2015 GBP'000 GBP'000
GBP'000
Non-current assets
Intangible assets 11,125 14,020 12,713
Property, plant and equipment 28,918 36,274 33,289
Interests in associates 155 120 93
Deferred tax asset 1,381 550 1,260
---------- -------------- -------------
41,579 50,964 47,355
Current assets
Inventories 47,666 39,329 39,379
Trade and other receivables 12,864 13,988 13,260
Current tax asset 110 1,199 -
Cash and cash equivalents 4,057 3,585 9,900
---------- -------------- -------------
64,697 58,101 62,539
Total assets 106,276 109,065 109,894
---------- -------------- -------------
Current liabilities
Trade and other payables (27,380) (28,639) (28,733)
Current tax liabilities - - (2,472)
---------- -------------- -------------
(27,380) (28,639) (31,205)
Total liabilities (27,380) (28,639) (31,205)
Net assets 78,896 80,426 78,689
========== ============== =============
Equity
Share capital 3,000 3,000 3,000
Share premium account 11,961 11,961 11,961
Own share reserve (1,498) (1,641) (1,601)
Capital redemption reserve 154 154 154
Special reserves - 1,467 1,467
Foreign exchange reserve (1,607) (559) (1,433)
Retained earnings 66,886 66,044 65,141
Total equity 78,896 80,426 78,689
========== ============== =============
Consolidated statement of changes in equity
(MORE TO FOLLOW) Dow Jones Newswires
December 10, 2015 02:00 ET (07:00 GMT)
Six months ended 30 September 2015
Equity attributable to equity holders of the parent
Share Share Own Capital Special Foreign Retained Total
capital premium share reserve reserves exchange earnings
account reserve reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
As at 1 April
2014 3,000 11,961 (1,676) 154 1,467 (212) 69,264 83,958
Total comprehensive
expense for the
period - - - - - (347) (410) (757)
Charge for employee
share-based payments - - - - - - 90 90
Exercise of share
options - - - - - - 66 66
Own shares - - 35 - - - - 35
Ordinary dividends
paid - - - - - - (2,966) (2,966)
As at 30 September
2014 3,000 11,961 (1,641) 154 1,467 (559) 66,044 80,426
Total comprehensive
expense for the
period - - - - - (874) (982) (1,856)
Charge for employee
share-based payments - - - - - - 46 46
Exercise of share
options - - - - - - 33 33
Own shares - - 40 - - - - 40
As at 31 March
2015 3,000 11,961 (1,601) 154 1,467 (1,433) 65,141 78,689
Total comprehensive
expense for the
period - - - - - (174) 120 (54)
Charge for employee
share-based payments - - - - - - 259 259
Exercise of share
options - - - - - - (101) (101)
Own shares - - 103 - - - - 103
Redemption of
reserve - - - - (1,467) - 1,467 -
As at 30 September
2015 3,000 11,961 (1,498) 154 - (1,607) 66,886 78,896
========= ========= ========= ========= ========== ========== ========== ========
Consolidated cash flow statement
Six months ended 30 September 2015
Unaudited Unaudited Audited
six months six months year ended
30 Sept 2015 30 Sept 31 Mar 2015
GBP'000 2014 GBP'000
GBP'000
Operating (loss)/profit for
the period (58) (1,218) 1,700
Adjustments for:
Depreciation and impairment
of property, plant and equipment 4,104 3,462 10,300
Amortisation of intangible
assets 904 1,027 2,028
(Loss)/profit on sale of property,
plant and equipment (694) (4) 8
Loss on sale of intangible (388) - -
assets
Effects of foreign exchange 8 51 204
Share-based payments charge 259 107 155
Operating cash flows before
movements in working capital 4,135 3,425 14,395
Increase in inventories (8,346) (5,581) (5,595)
Decrease/(increase) in receivables 398 (389) 106
(Decrease)/increase in payables (634) 498 838
Cash (used in)/generated by
operations (4,447) (2,047) 9,744
Corporation taxes paid (2,599) (873) (2,103)
Interest paid (12) (5) (46)
Net cash (outflow)/inflow from
operating activities (7,058) (2,925) 7,595
-------------- ------------ ------------------
Investing activities:
Interest received 2 13 17
Purchases of property, plant
and equipment (2,036) (6,074) (10,057)
Proceeds from sales of property,
plant and equipment 2,089 9 157
Acquisition of intangible fixed
assets (335) (7,755) (8,130)
Proceeds from sales of intangible 1,495 - -
assets
Net cash generated from/(used
in) investing activities 1,215 (13,807) (18,013)
-------------- ------------ ------------------
Financing activities:
Dividends paid - (2,966) (2,966)
Settlement of share awards - (131) (130)
Net cash used in financing
activities - (3,097) (3,096)
-------------- ------------ ------------------
Net decrease in cash and cash
equivalents (5,843) (19,829) (13,514)
Cash and cash equivalents at
beginning of period 9,900 23,414 23,414
Cash and cash equivalents at
end of period 4,057 3,585 9,900
============== ============ ==================
Notes to the condensed financial statements
Six months ended 30 September 2015
1. General information
Mulberry Group plc is a company incorporated in the United Kingdom under the Companies Act 2006. The half-year results and condensed consolidated financial statements for the six months ended 30 September 2015 (the interim financial statements) comprise the results for the Company and its subsidiaries (together referred to as the Group) and the Group's interest in associates.
The information for the year ended 31 March 2015 does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. A copy of the statutory accounts for that year has been delivered to the Registrar of Companies. The auditor's report on those accounts was not qualified, did not include a reference to any matters to which the Auditor drew attention by way of emphasis without qualifying the report and did not contain statements under section 498(2) or (3) of the Companies Act 2006.
The interim financial statements for the six months ended 30 September 2015, have not been reviewed or audited.
2. Significant accounting policies
The accounting policies and methods of computation followed in the interim financial statements are consistent with those as published in the Group's Annual Report and Financial Statements for the year ended 31 March 2015.
At the date of approval of these financial statements, the following Standards and Interpretations which have not been applied in these financial statements were in issue but not yet effective:
-- IFRS 9: Financial Instruments; and -- IFRS 15: Revenue from Contracts with Customers.
The Directors do not expect that the adoption of this Standard will have a material impact on the financial statements of the Group in future periods. Beyond the information above, it is not practicable to provide a reasonable estimate of the effect of these Standards until a detailed review has been completed.
The Annual Report and Financial Statements are available from the Group's website (www.mulberry.com) or from the Company Secretary at the Company's registered office, The Rookery, Chilcompton, Bath, England, BA3 4EH.
3. Going concern
The Group has considerable financial resources together with a customer base split across different geographic areas and between directly operated stores, partner stores and wholesale accounts. The Group's forecasts and projections, taking account of reasonably possible changes in trading performance, show that the Group should be able to operate within the level of its current facilities. As a consequence, the Directors believe that the Group is well placed to manage its business risks successfully despite the uncertain economic outlook.
After making enquiries, the Directors have a reasonable expectation that the Company and the Group will have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the half year results.
4. Exceptional operating income
(MORE TO FOLLOW) Dow Jones Newswires
December 10, 2015 02:00 ET (07:00 GMT)
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