LONDON — Burberry Group plc reported a 22 percent rise in third-quarter revenues Tuesday, driven by strong sales of outerwear and large leather goods, along with a surge in sales in the Asia-Pacific region.
Revenues rose to 574 million pounds, or $901.2 million, in the three months to Dec. 31, from 470 million pounds, or $737.9 million, in the same period last year. Including the now-discontinued Spanish operations in the comparison, which contributed 10 million pounds in the third quarter of 2010, revenues rose 19.6 percent. Dollar figures have been calculated at average exchange rates for the period.
Angela Ahrendts, chief executive officer of Burberry, said the figures marked a “strong performance” for the brand. “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,” she stated.
Retail sales, which represent 70 percent of Burberry’s revenues, grew 24 percent to 417 million pounds, or $654.7 million. On a same-store basis, retail sales grew 13 percent. Along with sales of large leather goods and outerwear, sales of Burberry London products, knitwear, men’s accessories and tailoring were among the categories driving revenues, Burberry said. Wholesale sales rose 16 percent to 130 million, or $204.1 million, the company said, benefitting from an improved supply chain and flow of product.
In terms of regions, Asia-Pacific grew the most, with revenues there rising 39 percent to 210 million pounds, or $329.7 million. In China particularly, same-store sales increased 30 percent during the period. And the company said its “flagship markets,” including London, Paris, Beijing and Hong Kong, all “outperformed,” driven by purchases by traveling luxury consumers. On that note, Stacey Cartwright, executive vice president and chief financial officer at Burberry, said the company is “just as prepared” for Chinese New Year, which begins Monday, in its London stores as it is in Beijing.
Europe’s revenues grew 21 percent to 160 million pounds, or $251.2 million, while the Americas grew at a far slower rate of 4 percent to 148 million pounds, or $232.4 million.
Cartwright said that in terms of wholesale growth in the Americas region, Burberry’s sales into major department stores were “up in the teens” in terms of percentage growth, but that rise had been offset by Burberry not continuing with its sales of off-price merchandise, which she said is part of Burberry’s strategy of “elevating the brand and walking away from activities that are not brand enhancing.” Retail performance in the Americas was up “high single digits” Cartwright said, against strong double-digit comparisons in the same period last year.
Licensing revenue grew by 19 percent during the quarter, to 27 million pounds, or $41.6 million. The company said eyewear and fragrance showed “excellent” growth, the latter boosted by the launch of the Burberry Body fragrance.
In a research note Tuesday, Freddie George at Seymour Pierce said the figures “should be received positively by the market. Burberry has excellent strategic growth opportunities in a luxury market with strong long-term growth credentials,” he said. “There are significant geographical and product mix opportunities plus operational leverage still to come from infrastructure investment over recent years.”
Ahrendts stated that the company continues to stay mindful of “the challenging macroenvironment,” while “executing our proven core strategies to achieve long-term sustainable growth.” The company plans to increase its retail space between 13 and 14 percent in the second half, and expects its wholesale sales to increase by “midsingle digits” in the second half.
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)
@heriethpaul and @gracebol have a moment on the @victoriassecret fashion show 2017. See every look from the runway on WWD.com. Link in bio. (📷: @giovanni_giannoni_photo) #wwdfashion #victoriassecret #VSFashionShow
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia