New markets hope for luxury brand Mulberry

The luxury brand Mulberry is pinning its turnaround hopes on new markets in the Far East and US after reporting a 28 per cent slump in annual profits.

Mulberry, which has issued two warnings on profits since October, said yesterday that they fell to £26m for the year to April from £36m the previous year. The company's sales were down 2 per cent at £165m.

It emerged this week that creative director Emma Hill is leaving the brand amid rumours of a disagreement on strategy.

But its chief executive Bruno Guillon said it is "not uncommon" for someone to leave after nearly six years, and the board is now discussing a replacement.

Of Mulberry's overseas ambitions, he added: "This is necessity, not a strategy. It is dangerous to have 80 per cent of your business in one region [Europe]."