British luxury brand Mulberry, renowned for its leather handbags, reported a 21% drop in annual revenue on Thursday and confirmed it had secured £20 million in funding — an amount it had previously targeted — with backing from its two largest shareholders, Challice and Frasers Group.

The company’s shares fell by approximately 5% following the announcement.

Mulberry also announced that James France, an executive at Frasers Group, will join its board of directors as a non-executive director, effective 30 July — signalling a possible shift in governance as the brand pursues its transformation strategy.

For the 52 weeks ended 29 March 2025, Mulberry recorded revenue of £120.4 million, down from £152.8 million the previous year. The brand also posted an underlying loss before tax of £23.7 million, slightly wider than the £22.6 million loss recorded the year prior.

The newly secured capital will accelerate Mulberry’s “Back to the Mulberry Spirit” transformation plan, which aims to streamline operations, reduce costs, and close 12 underperforming stores across Asia. The brand also intends to reinforce its wholesale strategy by expanding partnerships with premium department stores in the U.K., U.S., and Australia.

Mulberry expects to achieve £5.9 million in annualised cost savings. It has also secured £6.5 million in liquidity relief from HSBC UK, matched by a guarantee from Challice Limited, one of its major shareholders.

For the nine weeks to 1 June 2025, the group’s revenue declined by 18% year-on-year, with retail and digital sales falling by 17%. However, Mulberry noted early signs of stabilisation in key markets including the UK and North America.

Chief executive officer Andrea Baldo is leading the brand’s renewed focus on its British heritage, aiming to reconnect with loyal domestic customers. 

This heritage-driven repositioning forms part of a broader plan to drive revenue beyond £200 million and reach a medium-term adjusted earnings-before-interest-and-tax (EBIT) margin of 15%.

FashionNetwork.com with Reuters