Hand bag maker Mulberry posted a fall in annual profit and said conditions had deteriorated in the early part of the new financial year. Pre-tax profit fell 8% to £7.5m, as revenue increased 1% to £169.7m. The fall in profit was pinned on startup costs related the group's expansion in Asia. Stripping out those costs, pre-tax profit from existing business rose 36% to £11.3m. In the 10 weeks to 2 June, however, retail like-for-like sales were down 7% on-year, owing to a 9% fall in the UK, which the company blamed on 'lower footfall and fewer tourists, as more widely reported'. The company's gross margin in its financial year through March increased 185 basis points to 63.5%. 'We have made significant progress during the year on our international strategy, creating new Mulberry subsidiaries in China, Hong Kong, Taiwan and Japan,' chief executive chief executive Thierry Andretta said. 'We are also pleased to announce today the formation of a new majority owned venture to develop the business in South Korea.' 'Our international business is growing and following the completion of this set up phase in Asia, we will focus on omni-channel, digital partnerships and marketing investment in the region.' 'Although the UK market remains challenging, we will continue to invest in our strategy to develop Mulberry into a global luxury brand to deliver increased shareholder value.'
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