Burberry sales jump

City A.M. Reporter
Luxury group Burberry said a strong finish to the year delivered a 33 per cent rise in underlying fourth-quarter sales and would result in full-year profit at the top end of expectations.

The 155-year-old maker of raincoats and handbags said on Tuesday it made £390m of revenues in the three months ended March, excluding its restructuring Spanish arm.

That compared with an average forecast of £357m in a Reuters poll of nine analysts.

Burberry, best known for its camel, red and black check, reiterated its January view that it expected full-year profits at the top end of analysts' expectations, which at that time ranged from £250-£290m.

The company said it was planning a 12-13 per cent increase in average selling space in its 2011-2012 financial year, excluding stores acquired in China.

Chief executive Angela Ahrendts said: "Burberry had a strong finish to the year, driven by our design, digital marketing and retail initiatives, as well as good early progress in China.

"While the luxury industry faces global challenges in the year ahead, we remain confident in our team's ability to outperform, underpinned by the consistent execution of our key strategies."

Like-for-like retail sales in the fourth quarter increased 11 per cent, with a consistently strong performance in Asia Pacific, it said.

Burberry shares have surged more than sixfold over the past 2-1/2 years after the group slashed costs in the global economic downturn and then rode a rapid recovery in the luxury sector, driven by demand from Chinese shoppers and tourists.

The group has also benefited from speculation it might be a bid target in a sector hotting up with deals.