Burberry sees sales surge as luxury booms

 
Kasmira Jefford
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BRITISH fashion house Burberry has posted a 21 per cent uplift in Christmas sales after high-spending tourists continued to flock to its flagship stores in search of its iconic trench-coats and leather goods.

The 156 year-old firm said underlying sales rose to £574m in the three months to 31 December from £480m a year earlier, with signature outerwear and leather accessories fuelling half of its total retail growth.

Burberry’s share price has been chequered in recent months amid fears of an economic slowdown in China, but the firm said yesterday comparable store sales in China grew by 30 per cent in the quarter.

Flagship markets including London, Paris, Beijing and Hong Kong outperformed, attracting well-heeled travelling consumers, which helped push the group’s like-for-like sales up by 13 per cent.

Burberry suffered a weaker performance in the US, with sales growth slowing to four per cent from 20 per cent in the first half as it chose to cut back supplies for department stores.

Chief executive Angela Ahrendts said that, looking ahead, Burberry remained focused on its expansion plans “while staying mindful of the challenging macro environment.”

The group opened six stores in the quarter, including its first flagship in Paris and a third store in Brazil. It expects retail selling space to rise 13-14 per cent in the second half, down from 15 per cent growth previously.

Despite the upbeat statement, Burberry’s share price flatlined at £13.01 yesterday.

Hargreaves Lansdown’s head of equities Richard Hunter said this may be more indicative of the market sentiment towards retailers.

“Nothing wrong with the overall numbers, however the poor performance in the US and the weak fourth quarter guidance may worry the market,” Liberum analysts added in a note.