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UPDATE 1-Mulberry's losses widen as UK market deteriorates

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LONDON, Nov 13 (Reuters) - British luxury brand Mulberry reported a wider first-half loss due to investment costs and a tough trading environment in its home market, but forecast a better second half.

Under Chief Executive Thierry Andretta, the firm, best known for its leather bags, is pursuing a strategy to become a global luxury brand through developing international markets and extending ranges and its online business. However, its shares have fallen 23% over the last year.

The group currently trades from 102 owned stores and 21 franchise stores across 25 countries.

It said on Wednesday it made a loss before tax of 9.9 million pounds ($12.7 million) in the 26 weeks to Sept. 28, versus a loss of 8.2 million pounds in the same period last year.

Overall revenue was flat at 68.9 million pounds. While international sales rose 12%, UK sales dipped 4%, reflecting what it described as an increasingly promotion led trading environment and lower traffic to stores.

Mulberry said retail sales were currently reflecting similar trends.

"Against an uncertain backdrop in the UK and with the important Christmas period ahead, the board expects the group to trade profitably and to generate cash during the second half of the financial year," it added.

Shares in Mulberry closed Tuesday at 280 pence, valuing the business at 168.3 million pounds.

($1 = 0.7815 pounds) (Reporting by James Davey; editing by Kate Holton)