British luxury brand Mulberry reported first-half sales growth of 18.1% at actual exchange rates as its efforts to reduce discounting and expand internationally began to support trading. The company said the increase for the 26 weeks ended 26 September 2026 was consistent with its expectations under the Back to the Mulberry Spirit strategy.
At constant exchange rates, sales increased 18.2%. UK sales were 10% higher, with like-for-like growth of 9%, while the United States recorded growth of 28% and a 34% increase on a comparable basis. Continental Europe excluding Britain rose 23%, and Asia Pacific increased 5% at actual exchange rates.
Franchise and wholesale revenue grew 52%, with those channels accounting for 17% of group sales. The expansion reflects a strategy of developing distribution beyond directly operated stores, although the economics of wholesale and franchise arrangements differ from the margins achievable through the company’s own retail operations.
Mulberry said promotional activity represented a smaller share of sales than a year earlier. Excluding markdown activity, the proportion of revenue coming from promotions was three percentage points lower. Discounting can stimulate demand and clear stock, but repeated reductions may condition customers to wait for lower prices and weaken the margin earned on each item.
The brand is seeking a better balance between attracting buyers and maintaining the value associated with its products. Its programme includes new designs alongside established ranges such as Bayswater and Lily, giving customers familiar products as well as reasons to consider additional purchases.
Marketing and product presentation also form part of the strategy. The company has highlighted work with designer Christopher Kane and its return to London Fashion Week, activities intended to strengthen customer engagement and the visibility of the British luxury identity associated with Mulberry.
International demand creates opportunities for growth but introduces logistical and financial complexity. A retailer serving several markets must manage inventory, currency changes, import costs and differing consumer preferences. Reported sales can also be influenced by the exchange rates used to translate overseas income into sterling.
Distribution decisions require careful attention. Wholesale partnerships can extend reach without requiring the company to operate every store, but they may offer less direct control over how goods are sold. Franchise arrangements can support geographic expansion through local operators, while direct channels give the brand a closer relationship with its customers.
Higher sales do not automatically establish a return to profitability. Rent, labour, manufacturing, marketing and distribution costs all affect the operating result. A change in product mix or the proportion of sales made at full price may be particularly influential, because similar sales figures can produce different gross profits.
Mulberry has set medium-term ambitions for revenue above £200m and an adjusted operating profit margin of 15%. They remain targets, not achievements demonstrated by the trading update. The company’s detailed half-year results, expected in November, will show more about margins, cash, stock and costs.
Stock management will be especially important as Mulberry adjusts its approach to promotions. Goods manufactured for a previous season may require markdowns if demand fails to meet expectations, even where the company wants to preserve full-price sales. Changes in purchasing and production volumes can therefore influence whether the brand builds healthier margins or accumulates inventory that later needs discounting.
Currency conditions also affect international retail performance. A stronger or weaker pound can change the translated value of overseas sales, while customers’ travel and purchasing patterns can respond to relative prices between markets. Constant-currency comparisons help explain underlying demand, but the financial statements will still reflect actual transaction currencies and any hedging or sourcing arrangements used by the business.
The latest figures indicate demand has improved across several regions while the brand seeks to restore pricing discipline. Sustaining that progress will depend on whether customers continue buying at profitable prices and whether the company manages the expenditure required for its international ambitions.
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