Luxury Brand's Comeback
Mulberry returns to growth with narrowed losses as turnaround strategy gains significant traction.
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Key Points
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Mulberry's ownership structure is highly concentrated, with Chalice Limited owning about 56% and Frasers Group around 37%, leaving very little freely traded stock and potentially affecting liquidity and market dynamics.
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Underlying EBITDA turned positive for FY26, signaling tangible profitability momentum as the Back to the Mulberry Spirit strategy gains traction and constraints on costs and promotions ease.
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Franchise and Wholesale revenue surged by 56% in the latest quarter, underlining breadth of momentum beyond the direct-to-consumer business.
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Mulberry signaled its product and leadership evolution with launches such as the revived Roxanne and refreshed Bayswater, plus the appointment of Christopher Kane as Ready-to-Wear Creative Director.
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The group strengthened its balance sheet with a £20 million convertible loan note from its two largest shareholders and extended committed financing to 2028.
British luxury brand Mulberry is back in growth. The company posted revenue of £125.5 million for fiscal year 2026, up 4%, while pre-tax losses narrowed to £8.9 million from deeper deficits in prior years, according to WWD. Gross margin jumped to 72% from 67%, driven by stronger full-price selling and fewer discounts.
The rebound continued into the new financial year. For the 13 weeks ending June 27, revenue rose about 23% and like-for-like sales grew in most regions, WWD reported. CEO Andrea Baldo called progress in his turnaround plan "meaningful."
'Back to the Mulberry Spirit' Plan Drives Recovery
Baldo's strategy has three goals: simplify the business, restore commercial discipline, and reconnect with loyal customers. Rather than chasing new buyers, the brand focused on its core UK following, according to Yahoo Finance. That approach is paying off. UK and European markets posted solid growth in the first quarter of FY27. North America and Rest of World also contributed.
Asia Pacific remained the softest region but still delivered double-digit like-for-like gains. Wholesale and franchise revenue surged 56% in the latest quarter, showing the recovery is not limited to Mulberry's own stores. Underlying EBITDA — a measure of operating profit before certain costs — turned positive in FY26 for the first time in recent years.
Heritage Icons and Christopher Kane Anchor Brand Reset
Mulberry leaned hard into its most recognized products. The revived Roxanne bag and a refreshed Bayswater helped anchor the brand's return to its roots, WWD reported. These heritage icons gave existing customers a reason to come back rather than look elsewhere.
The brand also brought in designer Christopher Kane as Ready-to-Wear Creative Director. The appointment signals Mulberry is ready to evolve beyond handbags without abandoning its British identity. Kane's involvement is expected to add cultural energy and attract fashion press attention as the turnaround matures.
£20 Million Loan Buys Time to Hit £200 Million Target
Mulberry shored up its finances with a £20 million convertible loan note from its two biggest shareholders. Chalice Limited owns about 56% of the company and Frasers Group holds around 37%, according to Head Topics. That leaves very little stock freely traded on the open market. The loan extends the company's committed financing through 2028.
Management is targeting more than £200 million in annual revenue over the medium term, alongside a 15% adjusted EBIT margin. EBIT margin measures how much profit a company keeps from each pound of revenue. The company currently earns far less, so hitting that target will require continued cost discipline and sustained sales growth.
Analysts See Promise but Flag Leverage and Thin Float
Investor sentiment has warmed, with many recognizing the brand's stronger positioning and returning UK customers. But some analysts and shareholders remain cautious. High debt levels and questions about earnings leverage — how much profit growth follows each pound of extra revenue — are still seen as risks, according to Yahoo Finance UK.
The concentrated ownership structure adds another layer of complexity. With Chalice and Frasers together holding over 93% of shares, the freely traded portion is tiny. That can make the stock harder to buy or sell at fair prices. Still, the direction of travel is clearer than it has been in years.
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