Companiesandmarkets.com

Burberry sales rise 11% thanks to Chinese demand

Press release   •   Apr 17, 2013 10:29 BST

Burberry Group Plc (BRBY) reported fourth- quarter revenue that beat analysts' estimates, helped by demand for its more expensive products.

Sales at the UK's largest luxury-goods maker rose 11 percent to £503 million ($772 million) in the three months ended March 31, London-based Burberry said today in a statement.

That took revenue for the six months to March 31 to £1.116 billion, ahead of a company-compiled average analyst forecast of £1.098 billion.

The seller of raincoats and leather goods, known for its camel, red and black check pattern, said on Wednesday fourth quarter group sales built on better than expected third quarter results after a strong Christmas period.

Quarterly sales gained 10 percent excluding currency swings. Six-month sales climbed 15 percent in the Asia Pacific region, 10 percent in the Americas and 4 percent in Europe excluding currencies, Burberry said.

Angela Ahrendts, Burberry's chief executive officer, commented: "With three-quarters of our revenue now generated in retail,we are pleased with the 13% growth in this channel in the second half, driven by continued innovation in product, marketing and customer service, especially over Christmas and Chinese New Year."

Last September, Burberry shocked the luxury industry by warning of a spending slowdown particuarly in China - the driving force behind demand in recent years.

But recently, Burberry has been more upbeat, highlighting a rebound in Chinese demand.

Burberry plans to open about 25 so-called mainline stores and close 15 this fiscal year, while opening about 10 concessions and closing the same amount, it said. New outlets will be weighted towards China and Latin America and are expected to boost retail revenue by a low to mid single-digit percentage in the year through March 2014.

Shares in Burberry, whose spring/summer campaign is being modelled by Briton Cara Delevingne and David Beckham's son, Romeo, closed at 1,266 pence on Tuesday, down 8 percent on three months ago, valuing the business at around £5.6 billion.

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