Mulberry Group PLC (LON:MUL) (OTCMKTS:MLBGF) announced today that chief executive officer Bruno Guillon, formerly of Hermes, has resigned effective immediately. Former Mulberry CEO Godfrey Davis will take over the reins during the search to replace Guillon.
The internationally-known British handbag retailer has suffered a string of several quarters of reduced sales after attempting to move into the higher-priced luxury market.
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Statement from Mulberry
Mulberry Group PLC (LON:MUL) (OTCMKTS:MLBGF) released a statement today announcing Guillon’s departure: “I, along with the board, would like to thank Bruno for his hard work over the past two years,” Mr. Davis commented in the statement.
“He has helped improve the quality of the Mulberry offering and enabled the company to increase its international appeal and increase international retail sales. I am confident that Mulberry has the heritage, brand appeal and products to build on what has been achieved.”
Recent problems at Mulberry
Initial assessments from analysts concur that Guillon’s departure is likely related to the continuing slump in sales at Mulberry Group PLC (LON:MUL) (OTCMKTS:MLBGF). The company recently reported total sales had dropped 7% for the two-month period preceding January 25. That report follows several consecutive quarters of decreasing sales and repeated earnings warnings.
Guillon’s appointment as CEO was part of the rapid growth Mulberry Group PLC (LON:MUL) (OTCMKTS:MLBGF) experienced in late 2011 and 2012. The firm was looking to expand overseas and take its then-affordable bags and accessories into the luxury market.
The strategy has not been a success to date. Analysts have commented that perceptions of the brand have not moved in line with its prices, and customers are simply not willing to pay the higher prices the firm is asking for its products.
Adding to the sense of crisis at the company, long-time creative designer Emma Hill left over the summer.
Mulberry Group PLC (LON:MUL) (OTCMKTS:MLBGF) shares moved up today on the news, closing at 670 pence in trading in London, up more than 5%.