Luxury fashion retailer Mulberry has said profits will be ahead of expectations as it recovers faster from the pandemic than first thought.
In its latest trading update, the company said the "robust" sales trend delivered in the six months to September had continued into the second half of its financial year.
Extra cash made will now be used to increase the fashion brand’s marketing and advertising spend to further build brand awareness, Mulberry said.
And even with the extra spending, profits will still be ahead of market expectations for the group, it added.
Gross margins on products have been maintained, having hit 69% last year, compared with 59% in 2020. The group said it expected net cash balances at the end of the current financial year of more than £20m.
In November, the company revealed it had returned to profit after a 34% boost in sales to £65.7m for the six months to September 25, with a £2.4m loss turned into a £10.2m pre-tax profit for the period.
Bosses have been focusing on full-price sales and moving away from discounting, as pandemic restrictions ended.
Asia has been a strong growth area for the brand, with rich shoppers from the Far East opting to spend cash locally instead of travelling to the UK and Europe.
Strong sales in the US also helped Mulberry’s post-Covid recovery and bosses said at the time that supply chain issues had been offset by stocking up on raw materials at its Somerset factories.
The group intends to announce its full-year results on June 29.
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