Burberry Group PLC on Thursday reported a strong rise in interim profit and revenue, but maintained its near-term guidance amid a ‘challenging’ economic environment. It also lifted its interim payout by 42%.
For the six months that ended on October 1, the London-based fashion retailer posted a pretax profit of £251 million, up 31% from £191 million in the six months to September 25 last year.
Revenue rose by 12% to £1.35 billion from £1.21 billion. Burberry noted that ‘new product launches and seasonal collections performed strongly’. Leather goods sales saw good momentum with comparable sales increasing by 15% in the second quarter and by 11% in the first half.
In retail alone, sales increased by 12% to £1.06 billion from £944 million.
Adjusted operating profit rose 21% to £238 million from £196 million the year before, as adjusted operating profit margin improved to 17.7% from 16.2%.
Chief Executive Officer Jonathan Akeroyd said: ‘I am confident in our ability to deliver our medium-term targets and realise our potential as the modern British luxury brand. I am excited about what we can achieve in pursuit of our long-term ambition to reach £5 billion in revenue.’
Burberry added that it opened or renovated 22 stores including Bal Harbour in Miami and Taipei 101. It said it is on track to ‘open or refurbish 65 stores in the new concept this year, in addition to the 47 stores from financial 2022’.
Burberry in the past has described its new store concept as creating ‘a new customer experience in a uniquely British luxury setting’.
Looking ahead, given the potential impact of continued Covid-19-related disruption in China, as well as recessionary risk in Europe and the Americas, Burberry said it has decided to maintain its near-term guidance through to financial 2024. Its medium-term target is to grow sales to £4 billion per year at constant exchange rates.
It declared an interim dividend of 16.5 pence, up 42% from 11.6p a year ago.
Shares were down 0.3% at 1,998.00 pence each on Thursday morning in London.
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