Burberry sales suffer by 'Covid disruptions' in China

Third quarter comparable store sales at Burberry plc increased 1 percent, which the company said were impacted by Covid-19-related disruption in Mainland China.

Excluding Mainland China, comparable store sales grew 11 percent.

Based on the effective foreign exchange rates as of December 30, 2022, Burberry expects a currency tailwind of 160 million pounds on revenue and 70 million pounds on adjusted operating profit in FY23.

“Overall, we are pleased with our performance in the third quarter as double-digit revenue growth outside of Mainland China offset the impact of Covid-19-related disruption there,” said Jonathan Akeroyd, Burberry’s chief executive in a statement.

Akeroyd added saying: “Europe in particular continued to perform well, driven by strong trading over the festive period, and leather goods delivered another quarter of double-digit growth globally.”

Burberry sales grow outside Mainland China

Comparable sales in EMEIA grew 19 percent, while Americas reported a 1 percent decline, APAC 7 percent with Mainland China declining by 23 percent.

Declines in Mainland China, the company added, were partially offset by strong performances in South Korea up 10 percent, Japan up 28 percent and SAP up 15 percent.

Retail sales grew 5 percent year-on-year at reported rates during the quarter under review.

Burberry reports strong sales growth across product categories

The company further said that a strong programme of brand activations supported by pop-ups and social media driving customer engagement, including outerwear, festive and Lunar New Year campaigns.

Accessories continued to perform well with double-digit comparable growth in leather goods. Burberry said, Lola handbag range continued to see strong growth, supported by new styles including the Vintage Check Bouclé with the Frances bag and Giant Check also performing well.

Women’s ready-to-wear comparable sales increased a mid-teen percentage supported by dresses and knitwear featured in the brand’s seasonal campaigns. Outerwear comparable sales grew by a high-single digit outside of Mainland China.

The roll out of the new store concept continued with 15 stores completed in the quarter including Pacific Place in Hong Kong S.A.R, China and North Park Centre Dallas, USA leading to 37 for the year to date and 84 stores in the new concept in total. The company remains on track to complete 65 stores in FY23 with the aim to complete the roll out of the portfolio by FY26.