Luxury fashion brand Mulberry has announced a significant restructuring plan after reporting a 19% drop in group revenues to £56.1 million for the six months ending 28 September.
Newly appointed CEO Andrea Baldo revealed that 85 roles—approximately a quarter of the company’s 350-strong workforce—have been cut as part of efforts to “rebuild the business” amid challenging market conditions.
The job cuts predominantly affect staff at Mulberry’s London design headquarters and some office workers in Somerset. The company cited a “difficult trading environment and uncertain macroeconomic trends” impacting sales, with revenues from its wholesale and franchise business plummeting by 46% to £5.4 million due to reduced orders from partners in Italy and Denmark.
UK revenues also declined by 14% to £31.3 million, attributed to “low consumer confidence“. Pre-tax losses widened to £15.7 million for the period, compared with a £12.8 million loss a year earlier.
Mulberry is among several luxury retailers hit hard by a global decrease in luxury spending. The company’s restructuring comes a month after Mike Ashley’s Frasers Group—holding a 37% stake in Mulberry—abandoned plans for a £111 million takeover bid.
In a statement to shareholders, Baldo acknowledged the significant challenges facing the industry: “There is no question that our industry is facing a period of significant uncertainty, driven by a challenging and volatile macroeconomic environment that is impacting consumer confidence in several markets, particularly in our home country.”
Despite the setbacks, Baldo expressed confidence in the company’s future: “With the teams’ efforts on cost-cutting, a strengthened balance sheet, a renewed brand-first approach and a refreshed business strategy—details of which I’ll share in due course—I am confident we are making the right moves to bring Mulberry back to profitability.”
Read more:
Mulberry cuts 85 jobs as sales fall 19% amid global luxury downturn