Burberry shrugs off China worries after Christmas like-for-like sales hike
Luxury fashion brand Burberry has brushed aside fears of a slowdown in China as it reported a rise in festive sales.
The group said like-for-like global sales rose 1% over the 13 weeks to 29 December, with mainland China seeing a “mid-single” digit increase.
It comes amid slowing growth in China and fears of a sharp correction as the threat of a trade war between China and the US weighs on consumer sentiment.
Shares in Burberry had fallen in October when fellow luxury-goods giant LVMH Moet Hennessy Louis Vuitton posted a hit to some Chinese sales.
In its latest update, Burberry said it saw a consistent performance across all its regions, with the division including Europe also seeing a “small” improvement in tourist spending quarter on quarter.
But US sales were hit by falling numbers of shoppers hitting the stores in its third quarter.
Marco Gobbetti, chief executive of Burberry, said: “I am pleased with our progress in the quarter as we continued to build brand heat around our new creative vision and shift consumer perception of Burberry.”
“We will continue to manage the business dynamically as we reposition the brand. We confirm our outlook for the full year,” he said.
He added that “excitement is building” ahead of next month’s runway collection due from new creative director Riccardo Tisci, after a number of his limited editions were well received.
In the Christmas quarter, Burberry said total retail revenues fell 1% on a reported basis and dropped 2% with currency movements stripped out.
It is in the first phase of an overhaul, that is seeing it close some shops and pull out of department stores as it targets high-end shoppers.
The group is also revamping stores, with another 10 due to be completed by the end of its financial year.