Luxury retailer Burberry expects full year profits to be in the top end of analyst expectations after reporting a 17% increase in underlying revenue for the six months to September 30.
The British retailer has reported a 20% increase in retail sales, which were £294m in the same period last year, driven by sales of its core ranges of outerwear and leather goods, and same store sales rose by 9%. New retail space contributed 7% and mainline stores delivered double digit growth in both quarters – up 10% and 8% respectively.
Asia Pacific and Europe continued to deliver double digit comparable store growth, with Hong Kong, the UK, Italy and France among the best performing markets. Same store growth in the Americas was unchanged year-on-year due to a continued focus on improving margins.
Angela Ahrendts, Burberry chief executive, said: “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.”
It is planning to increase retail space by 25% over the second half with about 15% of that in China, which transferred from wholesale to retail on September 1.