Burberry Group plc announces results for the third quarter trading update and interim management statement for the time period of three months to 31 December 2013.
Highlights for the three months to 31 December 2013
- Retail revenue £528m, up 14%
- Comparable sales up 12%
- Compelling and focused festive offer
- Digital innovation continued to drive outperformance
- Double-digit growth in Asia Pacific; mid to high single-digit growth in Americas and EMEIA
- Further retail portfolio evolution
- Net five stores opened
- Including first standalone Burberry Beauty Box in Covent Garden, London
- As part of investment in under-penetrated markets, three stores acquired in Thailand
Angela Ahrendts, Chief Executive Officer, commented:
"In the all-important festive period, we are pleased with our 12% comparable sales growth, which was in line with our expectations. This performance reflects continuing strong brand momentum and our team's intense focus on retail execution, supported by a planned increase in investment in marketing, customer service offline and online and our retail portfolio.
At current levels, exchange rates will be a significant headwind in the second half and beyond, and the macro environment remains uncertain, but we are confident that our proven strategies will continue to deliver long-term value for shareholders."
Underlying change is calculated at constant exchange rates. Certain financial data within this announcement have been rounded.
Burberry updates on retail revenue for the third quarter.
At £528m, retail revenue in the third quarter increased by 14% at both constant and reported FX rates. Comparable sales growth was 12%. The balance came from new space, consistent with the unchanged full year retail guidance below.
The key drivers of retail growth remained consistent with previous periods:
- Traffic remained weak offline but grew online, reflecting evolving consumer behaviour
- Conversion increased offline and online
- Digital outperformed, enabled by investment in areas such as service (including additional languages), collect-in-store and fulfilment
Outerwear and large leather goods together contributed about half of mainline growth
Mens accessories and tailoring again grew strongly
The halo effect of the marketing campaign launching the Brit Rhythm for Mens fragrance helped Burberry Brit apparel increase penetration slightly, particularly in menswear and womens outerwear
Scarves, small leather goods and Beauty benefited from the co-ordinated festive offer across all customer touchpoints
Asia Pacific again delivered double-digit percentage comparable sales growth, led by Greater China and a continued improvement in Korea. Americas and EMEIA both delivered mid to high single-digit comparable sales growth. Performance was robust in the UK, France and Germany, while Italy remained weak.
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