Never mind the slowdown, Burberry’s revenue upThursday, 11 October 2012
Despite confirming the sluggish growth it vaccinated in September, Burberry has announced that the total revenue increased by 8 percent on an underlying basis to 883 million pounds, compared to the 830 million pounds it achieved during
the first half of 2011. Underlying retail revenue upped 10 percent to 577 million pounds.
"Against record prior year comparatives, Burberry delivered 8 percent total revenue growth and 10 percent 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," said Angela Ahrendts, Burberry's Chief Executive Officer.
Ahrendts also stated that the results should be set "against record prior year comparatives", and the trading update stressed that lower pace in the second quarter was countered by higher quality sales and average spend.
Burberry also defied the odds in the Stock Exchange, as it was the biggest positive weight on the FTSE index early morning Thursday, its shares rising 7.9 percent after the company reported an improvement in trading in September. It’s worthy to remember that when the quintessentially British retailer issued its profit warning a month ago, its shares plummeted by 19 percent, pulling down most of luxury companies’ stocks. In fact, the stock has dropped 28 percent since the profit warning.
"The profit warning on September 11 looks to have been a bit premature," Nick Bubb, independent retail analyst, said in a note published by Reuters. "The retail second quarter like-for-like of plus 1 percent was a bit better than feared, thanks to a modest pick-up in the last three weeks of the period, reversing the negative trend seen in the two-three weeks before that."
Jaana Jatyri, CEO of fashion forecasting company, Trendstop.com, warns however that "the fears surrounding Burberry's high profile profit warning last month will not have dissipated on the back of this trading update.
"The festive fourth quarter will strengthen the retailer's position but there has been a clear slowdown throughout the year,” she stresses, to add that "I still believe the longer term future of Burberry remains bright. It is an innovative, forward-looking brand, as shown by its recent investment in creating digitally-enabled stores of the future."