March 22 (Bloomberg) -- Mulberry Group Plc, a British luxury-handbag maker, dealt a third blow to investors in less than a year after saying that reduced tourist spending in London will cause full-year sales and profit to miss estimates.
The shares fell as much as 21 percent after the Somerset, England-based company said pretax profit for the year ending March 31 will fall to about 26 million pounds ($39.5 million) from 36 million pounds a year earlier. The average estimate of three analysts compiled by Bloomberg was 30.7 million pounds.
The announcement is the latest in a series of setbacks for Mulberry, which said in October that profit would unexpectedly fall because of declining shipments to wholesale customers. That followed the disclosure in June of full-year earnings that missed analyst estimates, causing the shares to slump. Mulberry shares have fallen about 47 percent in the past year, after rising about 20-fold in the three years through 2011.
“Trading across the retail portfolio during the last 10 weeks has been disappointing, including a reduction in the London stores,” Mulberry said today in a statement.
The stock was down 17 percent at 1,020 pence as of 8:31 a.m. in London. The number of shares traded in the first 30 minutes of trading exceeded the six-month daily average. Larger U.K. luxury-goods rival Burberry Group Plc also slid, falling as much as 3.4 percent to 1,340 pence.
Mulberry’s revenue for the year will be about 165 million pounds, the company said, down from 168.5 million pounds and compared with the 175.7 million-pound average estimate.
The company forecast growth of about 6 percent in sales at stores open at least a year, slowing from the prior year’s 26 percent increase. Revenue in the wholesale business will be down about 15 percent for the year, Mulberry said, mainly due to a strategic decision to trim its international accounts.
“After three years of rapid growth, Mulberry has experienced a year of consolidation whilst we build the foundations for future growth,” Chief Executive Officer Bruno Guillon said in the statement.
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