Clothing retailer Burberry posts 22% retail sales hike in year
14 Apr '06
3 min read
In the UK, existing stores produced a double digit gain in the period. Asia demonstrated continued underlying strength. Sales in Korea continued to firm, resulting in a modest gain for the quarter. Hong Kong and Southeast Asia achieved robust gains primarily on the performance of existing stores.
In line with expectations, total wholesale sales decreased by 7 percent on an underlying basis, 12 percent reported, during the second half. Primarily as a result of the ongoing adjustment of the brand's wholesale/retail balance in the US, sales in this market declined in the half.
In Spain, soft demand resulted in a significant underlying sales decline during the period. Fuelled by existing accounts, other Continental European markets achieved strong gains in the half. The UK continued to be challenging.
In Asia, timing differences negatively affected shipments to some markets. Boosted by new stores, emerging markets achieved strong gains. In conjunction with local partners, the Group opened five franchise stores in the half, including stores in Abu Dhabi (UAE) and Cancun (Mexico) in the fourth quarter.
Total licensing revenue in the second half increased 8 percent on an underlying basis, 6 percent reported. In Japan, the high single digit increase in underlying revenues largely reflected royalty rate increases as Burberry continues its initiatives to enhance brand positioning in that market. Global product licences achieved a solid underlying increase in the half.
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