BUSINESS AS USUAL: Burberry’s shareholders approved all 23 resolutions pertaining to the 2014-15 fiscal year at the annual general meeting on Thursday, including the directors’ remuneration report, which had been a source of some controversy a year ago.
The report passed with 92.25 percent of votes in favor, compared with last year, when more than 50 percent of votes were against. Although the vote on remuneration is a non-binding one, the company said it made an effort during the year to contact shareholders and better explain the reasoning behind the salary packages it offers itstop employees.
During the brief meeting at Nomura’s offices on the Thames, Bailey told shareholders and their representatives that the scarf category would come into “especially sharp focus” in the year ahead, while the company will also concentrate on unlocking the potential of digital and building up the beauty business.
He reiterated that capital expenditure would be 180 million pounds, or $281 million, with store openings in Seoul, New York, and Tokyo planned, and he also pointed to the fact that last year Burberry became the first luxury retailer and manufacturer to gain full UK Living Wage accreditation.
On Wednesday, Burberry posted a 10 percent uptick in first-quarter retail revenue 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.
Stripping out the positive exchange-rate impact, underlying growth was 8 percent, while like-for-like growth slowed to 6 percent, compared with last year’s figure of 12 percent, and the full fiscal year’s 9 percent.
A slowdown in Chinese tourist footfall in Hong Kong weighed on the growth figures, and Burberry’s chairman Sir John Peace addressed the issue during the AGM.
“Hong Kong has been a very difficult market for the luxury sector,” he said, adding that Mainland China and the traveling Chinese consumer remained important in terms of future revenue growth. “There are varying views of whether China will have a hard landing, but we trade very successfully there, and are optimistic that the market and the consumer will continue to grow.”