Last checked at 24 Mar 2020 07:00
FOR IMMEDIATE RELEASE
24 March 2020
Mulberry Group plc
("Mulberry" or the "Company")
Update on trading and impact of COVID-19
The board of Mulberry (the "Board") today provides the following business update in light of the ongoing and rapidly evolving situation regarding COVID-19.
The welfare of the Company's staff and customers is the Board's main priority and it has been taking all appropriate action to mitigate the impact of COVID-19 in line with Government advice.
The Board is also working to protect Mulberry's cash and to secure future value for its stakeholders by proactively managing its capital as well as identifying opportunities for cost savings.
Current trading
The Board has carefully considered the potential impact of COVID-19 on the Company's trading performance, including running various scenarios as to the possible impact on sales, profits, and cash flows.
Whilst the Board remains confident in the strength of the Mulberry brand, recent trading in our stores, particularly in the UK, has been severely impacted by the COVID-19 crisis. On 21 March 2020, the Board took the decision to close Mulberry stores in the UK until further notice. It notes the latest UK Government advice and is working on its implementation throughout the Company's operations. In addition, the Company is reviewing its international portfolio of stores on a case by case basis.
The Company's current financial year ends on 28 March 2020. In its half year results announcement released on 13 November 2019, the Company highlighted that it expected to be profitable and cash generative in the second half of the year. As a result of the impact on the Company's trading of COVID-19, the Board now expects the Company to make a small loss in the second half.
Given the rapidly evolving nature of the situation, is not possible to provide meaningful guidance on the Company's future performance.
Financing
Mulberry has a robust balance sheet with net cash as at 20 March 2020 of £8.8m. The Company has additional liquidity through its £19.0m of undrawn bank facilities and maintains a positive dialogue with its lenders with regard to optimising its operational flexibility and banking covenants. The Company has a supportive majority shareholder and welcomes the measures announced by the Government to support UK businesses through this challenging time. Given the current circumstances, the Board has determined that it is appropriate to suspend all shareholder distributions until further notice.
Thierry Andretta, Mulberry's Chief Executive Officer, said: "Our highest priority at this time is the health and safety of our colleagues, customers, and all other stakeholders. Whilst it is uncertain how long the virus will directly impact our markets and our businesses, we remain confident in the strength of our brand, and in our strategy over the long term".
For further information please contact:
Mulberry
Charles Anderson Tel: +44 (0) 20 7605 6793
Headland (Public Relations)
Lucy Legh / Emma Ruttle Tel: +44 (0) 20 3805 4822
GCA Altium Limited (NOMAD)
Tim Richardson Tel: +44 (0) 20 7484 4040
This announcement is released by Mulberry and contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 (MAR), and is disclosed in accordance with the Company's obligations under Article 17 of MAR. This announcement is being made on behalf of the Company by Charles Anderson, Group Finance Director of Mulberry.