Burberry said its full-year profits will be “at record levels” following a stronger than anticipated end to the year.

Total sales rose 7% to £707m in the six months to March 31, with outerwear footwear and accessories, including handbags and scarves, providing the strongest growth. Total retail sales rose 14% to £437m with like-for-likes up 10%.

The luxury brand said it now expects pre-tax profit for the year to be slightly above current market consensus, which is around £196m.

Burberry said the UK was among the best-performing markets, driven by tourism. Its European sales (excluding the poor-performing Spain) were up 5% to £213m.

Chief financial officer Stacey Cartwright said: “We expect profit to be up to record levels despite the challenging economic conditions.”

Burberry said the growth in retail sales was driven by new stores and by strong sales in full-price rather than outlet stores.

Total wholesale sales dropped 7% to £217m, a decline that Burberry attributed to the closure of some speciality stores in Europe and the continued poor performance of Spain. Burberry said that excluding these factors wholesale grew by a mid single-digit percentage.

The 7% decline in wholesale was better than the 10-12% decline the company had forecasted. Burberry said this comparative recovery was driven by an increase in in-season ordering as consumer demand grew, coupled with a drop in cancellations due to earlier deliveries.

Burberry’s licensing revenue grew 23% in the half but declined 6% on a constant currency basis. The strength of the yen during the period drove the reported figure up.