By  on January 12, 2006

LONDON — Burberry's burgeoning retail network generated some golden dividends in the run-up to Christmas.

Burberry Group plc said in a statement Wednesday that retail sales rose 21 percent to 115 million pounds, or $201.2 million, from 95 million pounds, or $177.3 million, in the third quarter ended Dec. 31.

Total sales for the period rose 4.3 percent to 168 million pounds, or $293.9 million, from 161 million pounds, or $300.5 million, despite a 23 percent decline in wholesale revenue.

All figures have been converted at average exchange rates during the respective periods.

During the period, retail sales accounted for 68 percent of total revenue.

Burberry chief executive Rose Marie Bravo, who will step down this summer, said the engines driving the business in the period were "core outerwear," "reinvigorated classics" and a strong start to the spring season.

Top sellers included shorter trenchcoats, new quilted jacket styles and duffle coats in fresh shades of baby pink and blue. The Haymarket handbag was also another driver of sales.

"The favorable initial response to early spring deliveries across all categories provides a good start to Burberry's 150th year," Bravo said in Wednesday's statement.

In a telephone interview, Burberry's chief financial officer, Stacey Cartwright, said the third-quarter numbers are a result of Burberry's decision to push retail as a core growth strategy.

The statement said Burberry's 12 newly acquired retail locations in Taiwan contributed 5 percentage points to the retail gain. In addition, Burberry opened stores in San Diego and Palm Beach Gardens, Fla., as well as two concessions and three outlet stores worldwide.

Average selling space increased approximately 9 percent in the quarter. The company also opened three franchises in the period, in Bombay, Athens and Dubai.

In the fourth quarter, Burberry will continue with plans to open two more units in Florida: a store in Naples and an outlet in Sawgrass Mills.

Those plans had been postponed by hurricane-related construction delays. "The stores were due to open before Christmas, and would have made a nice contribution to sales in the quarter," Cartwright added.

By region, there were solid gains in the U.S., continental Europe, Hong Kong and South Asia. The statement said the U.K. market — an important one for Burberry — improved "marginally" compared with recent trends, as did South Korea.

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