Burberry sales jump despite tough market
BURBERRY warned yesterday that conditions in some of its markets, including China, were getting tougher, despite a 14 per cent increase in first-half sales, sending shares down almost four per cent.
The luxury group said total revenues reached £1.1bn in the six months to 30 September, thanks to strong performance across all regions.
However, it warned it had seen “some softening” in growth in the second quarter from Chinese consumers, both at home and when travelling.
Despite the cautionary tone, Burberry chief financial officer Carol Fairweather sought to allay concerns: “In the second quarter, we still saw high single-digit growth in Asia, and from the Chinese, in China and when they were travelling.”
“We still saw good growth from [the] Chinese. It just wasn’t double-digit as it had been in previous quarters. We believe that will probably be outperformance compared to our peers,” she said.
Fairweather also noted that in Hong Kong, Burberry posted double-digit sales growth in both the first and second quarter.
Retail sales grew by 15 per cent to £748m while like-for-like sales were up 10 per cent. Wholesale revenues rose five per cent, to £317m.
The company said the impact of unfavourable exchange rates had been reduced, but warned that if rates remained at current levels, the impact on retail and wholesale full-year profit would still be material.