Burberry has felt the pinch of China’s Covid lockdowns, as store sales in it biggest market increased only 1 per cent in the three months ended 2 July.
Nevertheless, the fashion powerhouse reported a 16 per cent increase in overall sales – with the European, Middle Eastern and African (EMEIA) market performing particularly well.
Store sales in EMEIA grew by 47 per cent on last year’s levels.
“Our performance in the quarter continued to be impacted by lockdowns in Mainland China but I was pleased to see our more localised approach drive recovery in EMEIA, where spending by local clients was above pre-pandemic levels,” said chief executive Jonathan Akeroyd.
“While the current macro-economic environment creates some near-term uncertainty, we are confident we can build on our platform for growth.”
Following the results – which include a £400m share buyback programme that will be completed by the end of FY23 – Burberry said it would continue to target “high-single digit revenue growth and 20% margins in the medium term.”
The company expects revenue to be around £190m, with a £90m adjusted profit, down by £2m from earlier forecasts.
Commenting on the results, Edison Group’s director Russell Pointon said: “Burberry will need to continue to rely on high engagement on social media to drive traffic to its website, and build on the momentum created by its high profile celebrity-driven campaigns – particularly amid soaring costs in its home market.”