Mulberry sees first-half profits fall 36% A Mulberry fashion show. Photograph: Dave M. Benett/Getty Images Luxury handbag maker Mulberrry has seen first-half profits tumble 36% but said the second half of the year looked "encouraging." Mulberry, whose bags are carried by (and named after) celebrities including Alexa Chung, warned in October that annual profits would be lower than last year's £36m due to slowing demand in Asia and its decision to stop supplying small retailers in Italy and Belgium whose stores it considers too downmarket. Mulberry's Bayswater and Alexa bags sell for between £800 and £1,000. The company made a pretax profit of £10m in the six months to 30 September, down from £15.6m a year ago. But since then, like-for-like sales at its shops have climbed 11% and Mulberry said it would meet the City's current expectations. A Reuters poll puts the average profit forecast at £29.6m. Total retail revenues rose 19% in the nine weeks to 1 December after Mulberry opened four new stores, with plans to open another 17 to 20 this financial year. It has started building a second factory in the UK. Rival Burberry also blamed stuttering demand in China for its own profits warning in September. Bruno Guillon, who joined Mulberry as chief executive from Hermès earlier this year, said: "We have rationalised certain wholesale accounts and refocused the outlet business which has impacted financial performance in the short term. However we firmly believe that this is in the long term interests of transforming Mulberry into a global luxury brand.