Burberry’s H1 results confirm fall in sales growthThursday, 11 October 2012
British Fashion House Burberry has confirmed that its
revenues witnessed a sharp downfall in its second quarter of first half results owing to slower demand in the UK and China. Its total revenue witnessed 8 per cent growth at 883 million pounds (1, 412 million dollars).
Commented Angela Ahrendts, Chief Executive Officer, “Against record prior year comparatives, Burberry delivered 8 per cent total revenue growth and 10 per cent retail growth in the first half, albeit slowing in the second quarter. In a more challenging external environment, footfall declined but brand momentum remained strong, particularly with our higher spending luxury consumer.”
According to the company statement, apart from markets like Hong Kong, France and Germany markets, its new men’s tailoring and men’s accessories performed strongly. Burberry said it is making an ongoing investment in retail, with 13 stores opened in the period, including flagships in Milan, Rome, Hong Kong and Regent Street, London. The retailer also closed seven stores in the first half. In the second half, average retail selling space is expected to increase by about 14 per cent as the retailer opens in cities including Chicago, Shanghai and Knightsbridge, London, where it will open a standalone menswear store. It will also open in Brazil, Mexico and the Middle East. Full year capital expenditure plans remain unchanged at 180-200 million pounds (288 to 320 million dollars.
For the second half of fiscal 2012-13, Burberry expects to increase average retail selling space by about 14 per cent. For the second half of FY 2012-13, it expects broadly unchanged underlying wholesale revenue year-on-year. It was 230 million pounds (368 million dollars) in 2011/12.