TIDMBRBY
RNS Number : 3762H
Burberry Group PLC
11 July 2012
11 July 2012
Burberry Group plc
First Quarter Trading Update
and Interim Management Statement
Highlights
-- Total revenue GBP408m, up 11% underlying
-- Retail revenue GBP280m, up 14% underlying
- 6% comparable store sales growth
- Led by UK, France, Germany and Greater China
-- Wholesale revenue GBP102m, up 9% underlying
- Benefiting from earlier deliveries
- Consistent with mid single-digit % underlying growth expected in H1
o Including planned rationalisation in US and Europe
-- Licensing revenue GBP26m, down 5% underlying
- Q1 impacted by phasing of licence terminations
- Full year still expected to be broadly unchanged year-on-year
-- Further strategic and operational progress
- Continued elevation of core outerwear and large leather goods
- Strong growth in men's tailoring and accessories
- Six mainline stores opened
o Including fourth store in Brazil and Russell Street in Hong
Kong
- Investment in flagship markets continues
o Key openings later this year in London, Milan, Chicago, Hong
Kong and Shanghai
Angela Ahrendts, Chief Executive Officer, commented:
"With continued brand momentum, Burberry has delivered a robust
first quarter. Revenue was up 11% against a more challenging
external environment. Sales in retail, now about 70% of the
business, increased by 14%, with initiatives to elevate brand
equity balanced by improved store productivity and new space.
Building on our balanced business model and strong operational
foundation, we continue to invest in our retail, digital and
marketing strategies to drive long-term sustainable growth, while
remaining responsive to the changing external environment."
Underlying change is calculated at constant exchange rates.
Certain financial data within this announcement have been
rounded.
Revenue by channel of distribution
Three months to % change
30 June
GBP million 2012 2011 reported underlying
FX
--------------- -------- -------- --------- -----------
Retail 280 245 14 14
Wholesale 102 95 8 9
Licensing 26 27 (2) (5)
-------- -------- --------- -----------
Total revenue 408 367 11 11
--------------- -------- -------- --------- -----------
Retail/wholesale revenue by region
Three months to % change
30 June
GBP million 2012 2011 reported underlying
FX
--------------- -------- -------- --------- -----------
Asia Pacific 146 121 20 18
Europe 118 107 10 16
Americas* 91 88 4 2
Rest of World 27 24 9 9
-------- -------- --------- -----------
Total 382 340 12 12
--------------- -------- -------- --------- -----------
* Americas revenue growth impacted by planned rationalisation of
wholesale distribution
Retail
Retail sales in the first quarter increased by 14% at constant
and reported FX. Within this, comparable store sales growth was 6%,
with the balance from new space.
In mainline, there was a further increase in average selling
prices, driven by product innovation, a higher penetration of
Burberry Prorsum and London and rationalisation of opening price
point products in core outerwear and accessories. Men's tailoring
and non-apparel again performed strongly, as did new merchandising
strategies in soft accessories.
Within the comparable store sales growth, there was strong
mainline growth in the UK, France, Germany and Greater China, while
Italy and Korea remained weaker markets. Mainland China delivered
double-digit comparable growth, with particular strength in
Beijing. Two large flagships in London and Chicago are due to
reopen later this year.
During the first quarter, Burberry opened six mainline stores
including the fourth store in Brazil (JK Iguatemi mall in Sao
Paulo) and Russell Street in Hong Kong, and closed two. In the year
to 31 March 2013, a 12-14% increase in average retail selling space
is planned, with a shift from smaller to larger format stores.
Wholesale
Wholesale revenue in the first quarter increased by 9% on an
underlying basis (up 8% at reported FX), with some re-phasing of
deliveries, mainly in Europe, into the first quarter from the
second quarter.
This performance is consistent with guidance of a mid
single-digit percentage increase in underlying wholesale revenue
for the six months to 30 September 2012. Further rationalisation of
the brand's distribution in both Europe and the United States is
planned in this period. Double-digit percentage growth is expected
in key US department store doors and Emerging Markets franchise
partners.
Licensing
Total licensing revenue in the first quarter decreased by 5% on
an underlying basis (down 2% at reported FX). Global product
licences again delivered double-digit growth. Japanese apparel
royalty income was broadly unchanged while Japanese non-apparel
income was down, largely reflecting the termination of certain
licences in June 2011. In the year to 31 March 2013, Burberry
continues to expect licensing revenue at constant and reported
exchange rates to be broadly unchanged year-on-year.
Discussions continue between Burberry and Interparfums regarding
the potential establishment of a new operating model for the
Burberry fragrance and beauty business.
Financial position
Except for the trading activities described above, there has
been no significant change to the financial position of the
company.
Enquiries
Burberry 020 3367 3524
Stacey Cartwright EVP, Chief Financial Officer
Jenna Littler VP, PR and Corporate Relations
Fay Dodds Director of Investor Relations
Brunswick 020 7404 5959
Nick Claydon
Laura Cummings
There will be a conference call for investors and analysts to
discuss this update today at 9am (UK time). The conference call can
be accessed live on the Burberry website (www.burberryplc.com),
with a replay available later.
Burberry will release its First Half Trading Update for the six
months to 30 September 2012 on 11 October 2012. It will announce
its Interim Results for the six months to 30 September 2012 on 7
November 2012.
Certain statements made in this announcement are forward-looking
statements. Such statements are based on current expectations and
are subject to a number of risks and uncertainties that could cause
actual results to differ materially from any expected future
results in forward-looking statements. Burberry Group plc
undertakes no obligation to update these forward-looking statements
and will not publicly release any revisions it may make to these
forward-looking statements that may result from events or
circumstances arising after the date of this document. All persons,
wherever located, should consult any additional disclosures that
Burberry Group plc may make in any regulatory announcements or
documents which it publishes. All persons, wherever located, should
take note of these disclosures. This announcement does not
constitute an invitation to underwrite, subscribe for or otherwise
acquire or dispose of any Burberry Group plc shares, in the UK, or
in the US, or under the US Securities Act 1933 or in any other
jurisdiction.
Notes to editors
-- Burberry is a global luxury brand with a distinctive British
heritage, core outerwear and large leather goods base and some of
the most recognised icons in the world.
-- Burberry designs and sources apparel and accessories, selling
through a diversified network of retail (including digital),
wholesale and licensing channels worldwide.
-- Burberry has five strategic themes to underpin its growth:
leverage the franchise; intensify non-apparel; accelerate
retail-led growth; invest in under-penetrated markets; and pursue
operational excellence.
-- At 30 June 2012, Burberry globally had 196 retail stores, 207
concessions, 48 outlets and 58 franchise stores.
-- Burberry, which is headquartered in London, was founded in
1856. It is listed on the London Stock Exchange (BRBY.L) and is a
constituent of the FTSE 100 index.
-- BURBERRY, the Equestrian Knight Device and the Burberry Check
are trademarks belonging to Burberry which are registered and
enforced worldwide.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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