Mulberry chief executive Thierry Andretta has said there is “no doubt” the loss of VAT-free shopping is weighing on the handbag maker’s UK performance, as the company posted annual results.
The accessories brand recorded revenue growth of 4% to £159.1 million in the year to April 1, but sales here slipped to £87.7 million from £88.5 million.
In contrast its Asia Pacific arm saw sales improve 3% and the wider international sales rose 12%.
The retailer is among those exposed to the impact from duty-free shopping being axed in 2021, and Mulberry closed its Bond Street shop earlier this year after sales and footfall tumbled.
Andretta told the Evening Standard: “London continues to be an iconic shopping destination and our beautiful new store at the Battersea Power Station is performing well. However, there is no doubt that the lack of VAT-free shopping has impacted our UK performance, and we, along with other British brands, are suffering the consequences of this.”
He added: “We once again urge the Government to reconsider this policy so British businesses can continue to thrive and invest, in order to create and protect jobs in the UK.”
Pre-tax profits fell 38% to £13.2 million, in part due to costs linked to the Bond Street closure.
Mulberry, which is celebrating the 20th anniversary of ‘it-bag’ the Bayswater in 2023, said group revenue for the first 12 weeks of the new financial year is up 6%. UK retail sales are in line with the same period last year.
In the firm’s update Andretta said: “Notwithstanding the ongoing uncertainty in the economic and geopolitical environment, we are confident in our strategy and continue to invest, including in further store openings across the network planned later this year.”
