LONDON — Sales of aviator jackets, shearling boots and sling bags fueled growth at Burberry Group plc, which posted a 21.6 percent rise in first-half revenues to 641 million pounds, or $974.3 million, from 527 million pounds, or $801 million, in the corresponding period last year.
Burberry said Wednesday second-quarter sales rose 11.3 percent to 382 million pounds, or $580.6 million, from 343 million pounds, or $521.4 million.
All figures have been calculated at average exchange rates for the six-month period ended Sept. 30. Burberry released sales figures on Wednesday, and will report full interim results next month.
“These were high-quality sales — from main line stores rather than outlets — and there were fewer markdowns than in the past,” said Stacey Cartwright, Burberry’s chief financial officer. “And our goal in the period was to drive margins rather than comparative sales.”
She added the mood among Burberry customers is upbeat. “Keep in mind that we are talking about an international, traveling, luxury customer. We are seeing the brand momentum continue, and one of our challenges going forward is making sure we keep pace with demand,” she said.
Cartwright added that about 30 percent of Burberry’s customers in London are Chinese tourists.
Angela Ahrendts, Burberry’s chief executive officer, said Burberry was expecting full-year profits before taxes to be in the top half of market expectations — despite the company’s strong second half last year.
Analysts expect Burberry to post profits of up to 260 million pounds, or $411 million, for the fiscal year ending March 31. That figure excludes the Spanish business, which is undergoing restructuring.
Ahrendts said product innovation, digital and consumer service initiatives, and Burberry’s acquisition of its Chinese retail operations in July “underpin our confidence in delivering long-term sustainable growth.”
Double-digit growth in regions such as Asia-Pacific and the Americas was another driver behind the 21.6 percent rise in sales. Burberry said sales in Asia-Pacific grew 50 percent, while those in the Americas grew 14 percent. Sales in Europe grew 9 percent, with the U.K., Italy and France among the strongest markets.
Asked about the impact on revenue of Burberry’s decision to live-stream its spring runway show directly to its major stores worldwide, Cartwright said the company “did not go into that level of detail,” but said the streaming events undoubtedly contributed to the 8 percent rise in second-quarter like-for-like retail sales.
Citigroup Global Markets said in a report on Wednesday that Burberry’s second-quarter retail sales were better than expected, and reflected the “continued outperformance” of outerwear and leather goods, as well as double-digit growth in Asia and Europe.
Cartwright declined to comment on persistent market speculation that Burberry could be a takeover target from a big luxury group or a private equity fund. “We have a lot of growth ahead, and we’re keeping our heads down and getting on with our work. We’re delighted with the progress so far,” she said.
The Citigroup report also addressed the rumors, saying there was little “strategic and financial rationale for private equity money to enter so late in Burberry’s transformation story. Likewise, we struggle to find strategic rationale for PPR and LVMH to add another soft luxury brand to their portfolio.”
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