BARNETT STEPS DOWN, BURBERRY SET FOR IPO
Byline: Lisa Lockwood
NEW YORK — As expected, Victor J. Barnett, 68, has stepped down as chairman of Burberry in preparation for the planned partial initial public offering that’s scheduled to take place by next June.
This move enables Great Universal Stores PLC, Burberry’s parent, to appoint an independent, nonexecutive chairman of Burberry, which is consistent with customary U.K. practice.
Barnett’s resignation confirms a report that appeared in these columns in January. His successor hasn’t been named yet.
Barnett will continue to serve as a director of GUS, a position in which he has served since 1987. Barnett had been chairman of Burberry since February, 1998, prior to which he was chairman of Burberrys America.
“He has worked very closely with me over the past four years as we tried to change the perception, revitalize and restructure this great brand,” said Rose Marie Bravo, chief executive officer of Burberry, in a telephone interview from London. “He’s been my partner in what I call all the big ideas,” she added, citing the renegotiation of the Japanese licensing agreement, the acquisition of its Spanish licensee and the orchestration of its real estate deal on East 57th Street in New York, where it is currently building a new 36,000-square-foot flagship at 7-9 East 57th Street.
Burberry still plans to float up to 25 percent of the company in an initial public offering scheduled to take place by next June, “market conditions permitting,” said David Tyler, chief financial officer.
Meantime, Burberry’s financial picture continues to be bright. Burberry said Wednesday that for the first quarter ended June 30, Burberry’s sales increased 46 percent over those of the first quarter of 2000, and were up 25 percent excluding currency fluctuation, discontinued wholesale activities and revenues attributable to Burberry Spain, which was acquired June 30, 2000. The company does not announce precise sales figures, nor does it reveal earnings in the first and third quarters.
“Wholesale and retail operations both saw double-digit growth, with wholesale being particularly strong. Sales at Burberry Spain continued to grow at similar levels to last year,” according to a company statement. A new property has been secured in Barcelona for a flagship store, which is expected to open in spring 2002.
Wholesale orders for the fall and winter are ahead, “although not at the exceptional levels of last year,” the company said. Last year, sales grew 38 percent in the first half and 41 percent in the second.
As reported in June, Burberry’s operating profits more than quardrupled, to $98.7 million, on an 84.8 percent rise in sales, to $603.5 million, for the year ended March 31. This compares with operating profits at Burberry of $21.7 million on sales of $326.6 million a year earlier. Dollar figures were converted at current exchange rates.