Mulberry's Profit To Get A Handbagging
Luxury fashion brand Mulberry has warned its full-year profit will be below expectations.
The company said pre-tax profit for the year ended March 31 is expected to be around £14m.
The Somerset-based firm, famous for its high-end handbags, said new, lower-priced items would effect the results.
The company said: "Since the appointment three weeks ago of Godfrey Davis as interim executive chairman, a review of operations and strategy has been undertaken with the management team.
"The primary objective is to reinvigorate sales by the introduction of more affordable new product."
Although the company still plans to expand internationally, the pace of new openings has been slowed by nearly 40%.
It said for the 2014-15 fiscal year only five own store openings would occur, down from eight in the previous year.
The company said it would reduce the openings to control costs while allowing existing stores to "achieve greater traction".
Mulberry also confirmed its new UK factory is fully operational, having taken on 300 additional staff.
In January, around £400m was wiped from the company's share value after it reported a drop in its crucial Christmas period sales.
Last year, the company lost its top creative star, Emma Hill, and the group is still looking for a new chief executive after the departure in March of Bruno Guillon.
It also appears that an ongoing appetite for high-priced items is diminishing, even for its regular shoppers.
Releasing the trading update, Mr Godfrey said: "Following the recent change in management, we are focusing on achieving sales growth through the reinforcement of product offering at more affordable prices to meet the expectations of our loyal customers.
"This will have short-term financial consequences but is necessary to ensure the future strength of the Mulberry brand."