Home / Knowledge / News / Apparel/Garments / Burberry says material improvement in gross margin
Burberry says material improvement in gross margin
13
Oct '10
Burberry Group plc, the global luxury company, today reports on trading for the six months to 30 September 2010.

First half highlights

• Total revenue up 17% underlying (up 21% reported)

• Retail revenue up 20% underlying (up 24% reported)
o Comparable store sales growth of 9% - mainline stores up double-digit in both Q1 and Q2
o Material improvement in gross margin
o Outerwear and large leather goods drove about half of growth

• Wholesale revenue up 17% underlying (up 20% reported)
o Up 21% excluding China, slightly ahead of guidance

• Licensing revenue down 3% underlying (up 9% reported)

• Further strategic and operational progress
o Opened 20 mainline stores including two in India and first in Brazil
o Chinese retail operations acquired on 1 September 2010
- integration on track
- comparable sales for acquired stores up over 25% in first half
o Digital initiatives around shows in June and September increased awareness

• Looking forward, Burberry now expects
o About 25% increase in H2 selling space, of which about 15% is China
o About 10% increase in H2 underlying wholesale revenue excluding China
o Mid single-digit % decline in full year underlying licensing revenue, with improvement in guidance due to higher growth from global licences

Angela Ahrendts, Chief Executive Officer, commented:“The momentum at Burberry continues, with 21% revenue growth and a material improvement in the gross margin in the first half. While mindful of our strong second half last year, we currently expect adjusted profit before tax for the full year to be in the top half of market expectations. Continued product innovation, digital and customer service initiatives, coupled with the recent acquisition of our Chinese retail operations, underpin our confidence in delivering long-term sustainable growth.”

Retail
Retail sales increased by 20% on an underlying basis, up 24% reported (2009: £294m). New space generated 7% of the underlying growth, while China, which transferred from wholesale to retail from 1 September 2010, contributed 4%. Comparable store sales increased by 9% in the first half (Q1: +10%; Q2: +8%), with mainline stores delivering consistent double-digit sales growth in both quarters.

Burberry's two core categories – outerwear and large leather goods – drove about half of this growth, with strong performances also from Prorsum, shoes and childrenswear. Digital catwalk show initiatives in June and September further increased brand reach and awareness. Replenishment, inventory and pricing strategies introduced during the second half of last year led to a material improvement in gross margin in this first half.

By region, Asia Pacific and Europe continued to deliver double-digit comparable store sales growth, with Hong Kong, United Kingdom, Italy and France among the best performing markets. As the Americas continued to focus on improving margins, comparable store sales in the region were broadly unchanged year-on-year. In addition to those stores acquired in China, Burberry opened twenty mainline stores in the first half, including Marina Bay Sands, Singapore, London Heathrow Terminal 5 and two further childrenswear stores in Hong Kong. There was an 8% increase in average selling space year-on-year excluding China.


Must ReadView All

Textiles | On 19th Sep 2017

Karl Mayer expands service operations in Asia

Karl Mayer, a world leader in the production of warp knitting and...

Textiles | On 19th Sep 2017

Welspun bags Made in Green label by Oeko-Tex

Welspun, a leading home textiles manufacturer, has been awarded Made...

Courtesy: SGS

Textiles | On 19th Sep 2017

SGS expands testing facilities in Naucalpan, Mexico

SGS has expanded testing facilities in Naucalpan, Mexico, creating a...

Interviews View All

Manfred Mentges
Sedo Treepoint GmbH

We see a higher demand in colour management systems, as customers see big...

Mandeep Nagi
Shades of India

Women value something that is unique and has a flavour of India

Akash Khetan
Narayan Tex Fab

I find it hard to find professionals in Surat

Giorgio Mantovani
Corman S.p.A

Giorgio Mantovani, MD of Corman, with a presence in both Milano and New...

Marten Alkhagen
Swerea IVF AB

Marten Alkhagen, Senior Scientist - Nonwoven and Technical Textiles of...

Kai Poehler
Voith Paper GmbH & Co. KG

The glass mat industry is growing by five to eight per cent annually. Kai...

Robert Brunner
Devereux

Golfwear and menswear brand Devereux is set for greener pastures. Robert...

Jay Ramrakhiani
Occasions Elegance Wear

It is believed that by early 19th century, Varanasi weavers had moved away ...

Igor Chapurin
Chapurin

"Now we can see the Russian trend in international fashion. And Russian...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

September 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Planning to Take the Leap towards
Sustainability?

Do you see sustainability as a route to business growth?

Yes No

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes No

Active Poll

Do you see sustainability as a route to business growth?

Yes
74.5%
No
12.8%
Skip
12.8%

Total Votes: 47

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes No

Active Poll

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes
61.7%
No
25.5%
Skip
12.8%

Total Votes: 47

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes No

Active Poll

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes
87.2%
No
6.4%
Skip
6.4%

Total Votes: 47

Thanks for your valuable feedback. Claim your free latest sustainability e-book.

Active Poll

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes
70.2%
No
10.6%
Skip
19.1%

Total Votes: 47


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search