Burberry expects its adjusted pre-tax profit to be at the top end of market expectations as the retailer reported a 33% surge in sales for the fourth quarter to March 31.
Total sales at the luxury group for the fourth quarter were up 33% to £390m. Retail sales in the fourth quarter grew by 48% to £261m, with wholesale revenues rising 14% to £102m.
Total revenue for the six months to March 31 grew 30% to £860m, with European sales seeing an underlying growth of 16% to £254m. Total retail revenue had an underlying growth of 42% to £596m, with like-for-like sales increasing by 13%.
Burberry was expected to have been impacted by the tsunami and earthquake in Japan as its stocks fell shortly after the disaster. Chief financial officer Stacey Cartwright said the first priority had been the welfare of teams and partners in Japan.
In Japan, the retailer has 14 shop-in-shops and two flagship stores, which make up less than 2% of the group’s overall revenues and were “severely impacted in the immediate aftermath” but have recovered somewhat since then.
Angela Ahrendts, chief executive, said: “Burberry had a strong finish to the year, driven by our design, digital marketing and retail initiatives, as well as good early progress in China. As a result, we expect adjusted profit before tax for the financial year 2010/11 to be around the top end of market expectations.”
She added: “While the luxury industry faces global challenges in the year ahead, we remain confident in our team’s ability to outperform, underpinned by the consistent execution of our key strategies.”
For the next year Burberry is planning an increase of 12-13% in average selling space and will look to build presence in Latin America and the Middle East. In the next six months to September 30, Burberry expects revenue from wholesale excluding China to increase by a mid teens percentage.
As revealed by Retail Week, Burberry will create global flagships in London. Cartwright said London stores always benefit from an inflow of tourists and added with the bank holidays over the next couple of weeks she hoped this would continue to be the case.
She added: “Clearly with the Olympics coming next year as well we have put a renewed spotlight on London.”
For the coming season Cartwright said outerwear would continue to sell well for the coming season with lightweight trenches one notable product.