Mulberry has said Covid restrictions in China have resulted in a one per cent dip in sales across its retail and digital channels so far this financial year.
Stringent pandemic measures in mainland China meant the designer handbag maker was forced to temporarily shutter the majority of its stores, as well as its Shanghai distribution centre.
However, the London-listed firm said group revenue for the first 12 weeks of the financial year was up five per cent compared to the last year, as its wholesale business has seen sales up 29 per cent.
“Despite a difficult start to the year, with Covid restrictions being reintroduced in some parts of China, we can potentially expect the Asia-Pacific market to be an engine of growth for the group going forward,” according to the Edison Group’s Neil Shah.
Shares shot up three per cent in early trading on Wednesday morning.
For the year to 2 April 2022, the fashion house said profit before tax stood at £21.3m, a huge leap from 2021’s figure of £4.6m. This year’s figure included a one-off profit on disposal of Paris lease of £5.7m.
Group revenue was also up by one third to £152.4m, with the company citing a buoyant post-Covid recovery.
In the UK, retail sales increased 36 per cent to £89.8m, versus £66.2m, while China saw retail sales buoyed 59 per cent and South Korea up 11 per cent.
The company said its board was proposing a final dividend of 3 pence per ordinary share, compared to nothing offered in 2021.
“Looking forward, the Group is in a strong financial position, with the strategic decisions of the last few years driving profitable cash-generating growth,” chair Godfrey Davis stated.
He added: “However, we live in very uncertain times, with burgeoning inflation and the appalling war in Ukraine. Despite these headwinds, we are confident we will continue to build our business and add value for our shareholders in the medium term.”