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AIM-listed fashion brand Mulberry (LON:MUL) has warned that it will be substantially affected by House of Fraser’s entry into administration and purchase by Sports Direct. Mulberry has 21 concessions in House of Fraser stores across the UK, and management believe that between debtor balances, fixed assets and restructuring expenses these concessions require a £3 million provision for exceptional costs during the six months ending 30th September.
Management also warned that trading conditions across the UK had remained challenging during the current period, and if these trends continue in to the second half of the year then profits will be materially lower than expected. Internationally, the company is faring better and is broadly trading as forecast.
Shares in Mulberry were down by 24.25% at 431p (as of 14:30 BST).