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Mulberry's New Bags Are Selling, But Not Well Enough

Its new product ranges seem to be performing well, though.

It's been awhile since we've heard any positive news about Mulberry, and it sounds like it will still be a while longer.

The company warned Tuesday that profits for its fiscal year, which began in April, would be "significantly" below expectations, sending shares down nearly 12 percent. The company issued a similar warning in January.

While the British leather goods company saw profits drop nearly 50 percent in fiscal 2013, it had a positive outlook for the year ahead, and has just released results for the six months ending September 30, which weren't great. Total revenues were down 17 percent to £64.7 million (about $102 million). Retail sales declined the most at home in the UK (by 12 percent), while international sales increased by 20 percent. However, wholesale sales were down by a significant 30 percent, due to inventory reduction and conservative ordering, according to the company, which insists it has not lost any accounts.

Of course, much has changed for the company over the past year. CEO Bruno Guillon, who came to Mulberry from Hermès in 2012, stepped down in March, and former CEO Godfrey Davis has stepped in until a permanent replacement is found. Meanwhile, Mulberry hasn't had a creative director since last June. Still, it has recently released a couple of new product lines that it has hoped would help lure back core customers and stimulate sales: a lower-priced line called the Tessie and a range done in collaboration with model Cara Delevingne. According to the company, "The reaction to these bag families has been positive and they have contributed to the improving sales trends."

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There was no mention of any progress made towards finding a new creative director or CEO, though the company still seems confident that it's on the right track.