Share Dealing
Burberry shares fall on weak US market
Ellie Duncan, 17 January 2012
Luxury retailer Burberry has posted a 21 per cent rise in third quarter total revenue but leads the fallers on the FTSE today due to weaker US results.
The global company reported total revenue in the three months to 31 December 2011 of £574 million, while retail sales soared 23 per cent on an underlying basis to £417 million.
Wholesale revenue was up 15 per cent in the same period, to £130 million.
Shares in Burberry were trading down around 2 per cent to 1,269p at 12.13pm.
Growth in Asian markets continued to boost the group’s results and offset the disappointing 4 per cent revenue growth seen in the US.
In its trading statement, the group said it still expects mid single-digit percentage underlying wholesale revenue growth in the second half as brand rationalisation continued in UK and US markets.
However, the brand’s flagship regions, including London, Paris, Beijing and Hong Kong outperformed in the most recent quarter.
There were six new store openings during the third quarter, which included Burberry’s first flagship store in Paris, a third outlet in Sao Paolo, Brazil, and its fourth childrenswear store in the Middle East, increasing average selling space by 13 per cent.
Growth in selling space is expected to remain at between 13-14 per cent in the second half of the year.
Chief executive Angela Ahrendts said the luxury goods group had delivered ‘another strong performance’.
‘Our investment in flagship markets and digital technology has enabled our global teams to continue to drive customer engagement, enhance retail disciplines and improve operational effectiveness, further strengthening brand momentum.’
However, Ahrendts sounded a cautionary note for the coming year.
‘Looking ahead, we remain focused on executing our proven core strategies to achieve long-term sustainable growth, while staying mindful of the challenging macro environment,’ she added.
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