LONDON — Revenues at Burberry rose 19.2 percent to 546 million pounds, or $1.09 billion, in the six months to March 31, from 458 million pounds, or $885.8 million, in the same period last year.
In the full fiscal year, sales rose 17.1 percent to 996 million pounds, or $2 billion, from 850.3 million pounds, or $1.61 billion. All figures have been converted from the pound at average exchange rates for the respective periods.
The company said in a statement Tuesday that the brand’s growing nonapparel categories, including handbags, shoes and soft accessories — which now account for 33 percent of Burberry’s retail and wholesale revenues — along with a “consistent marketing message,” had helped the group weather the recent turbulence in consumer spending.
The company issued a trading statement Tuesday, and will release full results for the financial year ended March 31 on May 28.
“Burberry had a good finish to the year, against the background of an increasingly challenging external environment,” said Angela Ahrendts, chief executive of Burberry. “Looking forward, we [are very pleased] with the momentum of our brand as our core luxury, retail and nonapparel strategies continue to gain traction, while our seasoned management team focuses on improving the operational aspects of our business.”
Retail sales in the second half rose 17 percent to 282 million pounds, or $567.4 million, from 241 million pounds, or $466.1 million, in the same period last year. The company said retail revenues made up more than 50 percent of its total sales in the half, and were driven by sales of handbags and shoes, alongside outerwear and dresses.
In the U.S., the company said it saw “double-digit” comparable-store sales growth, with strong performance in tourist and oil-producing cities.
Overall, sales in the U.S. rose 19 percent to 137 million pounds, or $275.6 million, from 115 million pounds, or $222.4 million, while sales in the Asia-Pacific region rose 16 percent and in the rest of the world — excluding Europe and North America — sales rose 87 percent to 18 million pounds, or $36.2 million. Average retail selling space increased 12 percent in the second half, during which the company opened nine stores, 40 concessions, five outlets and its first stand-alone children’s store in Hong Kong.
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And, while economic conditions may be pointing toward a slowdown in the U.S. economy, the company said it views the region as an “underpenetrated market,” along with emerging markets such as China, and predicts a 20 percent growth in wholesale sales in the U.S. in the year to next March.
“We have in our favor a very strong tailwind behind us in terms of the momentum of the brand,” Stacey Cartwright, chief financial officer, told analysts on a conference call Tuesday. “Everything we’ve been doing has been standing us in good stead, while we’re cognizant of the headwinds in the economic environment.”
Spain, however, continued to be a weak spot for the company, both in terms of retail and wholesale sales, with a modest 4 percent growth in overall revenues to 91 million pounds, or $183.1 million, during the period.
“Spain does not have a huge luxury market, and our brand positioning in Spain is more of a better brand than a luxury brand.We don’t have that protection we seem to have secured for ourselves [elsewhere] from that luxury positioning,” Cartwright said, adding that the region also was experiencing a slowdown in the housing market more sharply than the rest of Europe.
Meanwhile, wholesale sales rose 28 percent to 219 million pounds, or $440.6 million, from 172 million pounds, or $332.6 million. The company said its nonapparel and outerwear had performed best at wholesale, and that the category had benefited from a more balanced product offer, a more frequent flow of goods to customers and an improved stock replenishment program.
The company said revenues from licensing were flat compared with the same period last year, at 45 million pounds, or $90.5 million. The effect on revenues of the company’s decision not to renew certain licenses, particularly in men’s wear, was offset by the volume growth in its global product licenses, including the successful launch of the fragrance Burberry the Beat.