Burberry is set for strong sales growth

LUXURY goods business Burberry is expected to report double-digit sales growth in its first-half trading update on Wednesday.

The performance follows a strong first-quarter trading update and comes after a flurry of takeover speculation has boosted Burberry’s share price 17 per cent in the past month.

The consensus forecast for the six months to September 2010 is for 15 per cent sales growth generating total revenues of £633m.

JP Morgan Cazenove analysts “expect underlying sales to sustain a strong trend,” producing a slightly stronger 17 per cent underlying sales growth and £643m revenues.

Burberry’s 2009 interim results saw profit before tax drop to £78m, from £97m in 2008, on revenues of £572m.

One of the UK’s most dynamic fashion houses, Burberry, which has been shortlisted for Company of the Year in CityA.M.’s inaugural awards, saw first-quarter wholesale sales grow 46 per cent on early order shipments, and retail comparable-store sales grow ten per cent.

Nomura forecasts first-half revenues of £623m due to more challenging conditions in the second quarter. It expects second-quarter revenues of £341m and raised Burberry’s target price to 960p from 826p.