Store sales fell at Burberry during the third quarter of 2021, as the coronavirus lockdown forced the closure of 62 stores – 15 per cent of its store network.
In an update this morning the business said its collections had resonated with consumers, and so despite Covid restrictions it achieved “a high single-digit full-price-sales increase” in the quarter, which translated into double digit growth in America, mainland China and Korea.
Overall its comparable store sales were down nine per cent for the third quarter, however, with growth for the business coming from full-price items offset by restrictions and a planned reductions in markdown items and reduced tourist traffic in the outlets.
More than a third (36%) of Burberry stores are currently open with reduced hours or restrictions in place, in addition to the 15 per cent still closed.
“Despite the challenging external environment, we made good progress on our strategic priorities in the quarter,” said chief executive Marco Gobbetti.
“We saw a strong increase in full-price sales as our collections and communication resonated well with new, younger clientele as well as existing customers. Our localised plans and digital capabilities helped drive growth in rebounding markets and we implemented our planned reduction in markdown.”
Interactive Investor head of markets Richard Hunter said the brand remained defiant in the face of the pandemic.
“Being at the luxury end of the market is a blessing and a curse in the current environment,” he said.
“On the one hand, Burberry’s wealthy customers should in theory be less affected by economic turmoil and the strength of full-price sales in the period provides some evidence for this. However, shopping for its products is seen as many as a physical experience, and so the widespread closure of stores and a tourist market which has all but disappeared for the moment is a bitter pill to swallow.”
The share price has had a determined run of late and has recovered by 60% since the low in March. Over the last year, however, the shares remain down by 24%, as compared to a drop of 12% for the wider FTSE100.