Burberry’s profits and sales have risen, with the luxury group setting out a transformation plan for its future growth.
Pre-tax profits at the luxury brand, whose chief creative officer of 17 years Christopher Bailey is due to depart, shot up 26% to £128m in the six months to September 30.
Sales climbed 9% to £1.263bn, with growth led by retail like-for-likes, which rose 4% in its first quarter and 5% in its second quarter.
Conversion improved in all regions, spearheaded by a return of top-spending customers. Asia Pacific, where the weak economy had previously hurt Burberry, was particularly strong.
Chief executive Marco Gobbetti set out a transformation plan for the business, focused around sharpening its brand positioning by changing its approach to communication, customer experience and product.
He was tight-lipped on the exact details of his plan but said that the business aimed to deliver high single-digit revenue growth and “meaningful” operating margin expansion. Adjusted operating margin currently stands at 14.6% while gross margin is 69.2%.
Gobbetti said: “Now is the right time for Burberry to implement the next phase of its transformation. By re-energising our product and customer experience to establish our position firmly in luxury, we will play in the most rewarding, enduring segment of the market.
“We have the foundations to build on and the team to execute our plans. This will enable us to drive sustainable growth and higher margins over time, whilst continuing to deliver attractive returns to shareholders.”