China and South Korea boost Burberry sales

Double-digit sales growth in China, South Korea, and the Americas underpinned a 37-per-cent lift in first-half sales for luxury fashion group Burberry to US$1.63 billion.

The lift reflected a recovery in-store sales as Covid-related lockdowns and trading restrictions eased in the six months to September 25, compared with the same period a year earlier when a swathe of stores was closed across key markets.

“We have made strong progress in the half,” said Burberry chair Gerry Murphy in a statement.

“Full-price sales are growing at a double-digit percentage, driving margin expansion and strong free cash generation. We are seeing an acceleration in performance in countries less impacted by travel restrictions and we remain confident of achieving our medium-term goals.”

The company reported an adjusted operating profit of $263 million, up 16.2 percent year on year.

While the Americas, Korea, and China buoyed sales, the company said other regions continued to be impacted by reduced tourist levels.

The company said its new store format – of which 15 are now complete with a target of 50 by the end of next March – was drawing higher-spending customers through the doors. Online sales were performing well with sales of goods at a full price almost doubling year on year.

During the six months, Burberry announced its CEO Marco Gobbetti was to stand down early next year, to be replaced by Jonathan Akeroyd in April.

Murphy paid tribute to Gobbetti’s “vision and leadership” during Burberry’s transformation and said the board expects Akeroyd will build on the strong foundations to accelerate growth and deliver further value for shareholders.