LONDON – Dwindling numbers of Chinese tourists in Hong Kong dented sales growth at Burberry in the first three months, traditionally a small quarter for retail sales at the brand.

Overall retail revenues in the three months to June 30 rose 10 percent to 407 million pounds, or $623 million, boosted by foreign exchange tailwinds and double-digit growth in EMEIA — the Europe, Middle East, India and Africa region, the company said in a trading update Wednesday.

Stripping out the positive exchange-rate impact, underlying growth was 8 percent, while like-for-like growth slowed to 6 percent, broadly in line with analysts’ estimates. But the numbers paled in comparison to last year’s figure of 12 percent, and the full fiscal year’s 9 percent.

First-quarter growth – which came partly from big cities on the European continent — offset a low, single-digit percentage decline in the Asia-Pacific region.

The performance in Asia was plagued by problems in the high-margin Hong Kong and Macau markets, which posted 10 to 20 percent declines in comparable sales.

The situation is not improving, and Burberry is projecting “adverse” effects from the region in the full fiscal year.

The company’s stock price closed down 2.6 percent on Wednesday at 15.78 pounds, or $24.51. All figures have been converted at average exchange rates for the periods to which they refer.

Carol Fairweather, the company’s chief financial officer, said in a conference call that tourists — mostly from mainland China — had accounted for 80 percent of sales in Hong Kong, but they are no longer shopping there.

Ongoing political tensions in the region and the growing strength of the yuan versus the euro have driven Chinese tourists to stores in Europe and other parts of Asia.

“In Hong Kong we are now targeting the local, domestic customer, redirecting our marketing, and driving conversion rates by ensuring we offer great service and product,” she said, adding that the company is already speaking to local landlords about “improving” rental fees in Hong Kong when reviews come up.

Fairweather noted that declining footfall in the region was not Burberry-specific, but a “challenge for the whole sector. The macro-economic climate remains uncertain for everyone. It’s no different for us than for any of the other luxury brands,” she said.

According to a report earlier this year from HSBC, the Chinese now represent “close to a third” of all luxury sales, with more than two thirds of their purchasing happening outside China.

Hong Kong and Macau represent about 10 percent of Burberry’s sales, and Fairweather said during that all of the stores remain “very profitable,” although she would not be drawn on whether the margins in the region remained at their peak of 40 percent.

The Chinese are still spending, and account for 30 to 40 percent of the company’s sales. Growth in overall Chinese spending was in the low single digits, below 6 percent. “As long as they are shopping somewhere, it’s fine,” she said.

Analysts had already forecast a slowdown in the quarter due to Burberry’s currency-linked price decreases in the Far East, and the ongoing weakness in Hong Kong and Macau.

Burberry’s retail revenue figure fell short of Bernstein’s forecast of 413 million pounds, or $632 million, and slightly overshot Barclays’ prediction of 5 percent growth in like-for-like sales.

Christopher Bailey, chief creative and chief executive officer, said the quarter’s performance “reflects our ongoing emphasis on serving our customers ever more effectively on and offline, and continued innovation in design and marketing – particularly around the iconic, British-made products that performed so well in the period.”

Burberry said the traveling luxury customer in France, Italy and Spain drove the double-digit growth in the EMEIA region, while the Americas delivered high single-digit percentage comparable growth, with footfall recovering through the quarter after a “soft” start.

Asia-Pacific experienced a low single-digit percentage decline. Stripping out the negative impact of Hong Kong and Macau, growth in Asia was up in the low single digits.

Comparable sales growth in Mainland China slowed, too, rising by a low single-digit percentage in the three months, while Japan saw “exceptional growth, albeit off a small base,” the company noted.

Digital continued to outperform, according to Burberry, with mobile penetration of sales more than tripling compared to the prior year, supported by new investment.

The company said it saw continued strong growth from its core heritage trench coats and cashmere scarves, as well as ponchos.

During the first quarter, Burberry opened five mainline stores and closed three. Fairweather said, in China, Burberry continues to streamline the store portfolio, closing legacy stores that don’t fit the brand profile. There are 67 mainline stores in China, and by the end of the year the aim is to have 63, the bulk of which are new.

Burberry’s guidance for the first half remains unchanged, with wholesale sales growth expected to be flat and beauty wholesale revenue set to grow by 10 to 15 percent at constant exchange rates.

For the full 2015-16 year, if exchange rates remain at current levels, Burberry said its reported retail/wholesale profit would be about 20 million pounds, or $31 million, higher than the previous year. That is an increase of about 10 million pounds, or $15.5 million, since the company’s guidance in May.

However, the company warned: “We currently expect this increase to be offset by a more adverse geographic mix, particularly from the high margin market of Hong Kong.”

Burberry said it is still expecting group adjusted profit before tax at constant exchange rates to be more second-half weighted than in the previous fiscal year.

Burberry is to release full interim results in November.

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