Sun above Burberry as it sees 9% rise in half-year revenue

Burberry Group enjoyed an increase in revenue

Burberry Group enjoyed an increase in revenue

Burberry Group had good news for investors as it saw not only a significant increase in its fourth quarter revenue, but the luxury goods maker recorded satisfying results for the half year ended March. It seems that demand for luxury goods in China improved as the UK-based company’s performance was undeniably driven by Chinese fondness for high-end products. Interestingly, even analysts are much surprised by that unexpected twist as company’s revenue significantly exceeded economists’ projections.

Good days for Burberry

On the 17th of April, Burberry Group released its data on the fourth quarter ended March, indicating that the luxury goods producer saw its sales climb as much as 11 percent to surprising £503 million. The result was significantly higher than analysts’ projections of about £485 million. In addition, the strong figures for the fourth quarter resulted in high revenue for the six months ended March which amounted to around £1.12 billion. Also half-year revenue topped analysts’ estimates of £1.09 billion.

The detailed findings indicated that retail sales, which account for three-fourth of  UK-based company’s revenue, climbed approximately 14 percent to as much as £375 million pounds in the three-month period ended March.  Even though fewer shoppers were recorded, Burberry Group recorded quite satisfying results due to increased medium spend.

In addition, the company saw its comparable stores sales jump around 7 percent as they were driven by surprisingly good sales in the Asia Pacific region, including China. On the other hand, the UK-based luxury goods maker informed that its second-half wholesale revenue slumped 3 percent. This not too optimistic result was much anticipated as many companies have been going through tough times in European markets for a long time.

Certainly, the released report on revenue is a pleasant surprise for Burberry Group itself and analysts as just in September 2012, the UK-based company had projected a spending slowdown. The trend was to be mainly seen in China which has been the main force behind demand for luxury goods. And indeed, luxury companies witnessed a slowdown in China’s spending, but the situation has been tackled and demand for luxury goods in China is steadily increasing.

Gloomy future ahead luxury brands

Burberry Group can take pride in its latest results, especially taking into account that other luxury goods companies cannot show off their figures. Interestingly, one of these companies is famous LVMH Moet Hennessy Louis Vuitton SA which informed that it witnessed the depressingly slow rate of growth in fashion and leather-goods revenue due to fewer Asian tourists in Europe and lower demand for its products in the world’s second economy as well.

But the fact is the luxury goods companies have been facing dauntingly weak demand in crisis-hit Europe.  Hence the companies are aware that they should seek new markets if they want to offset the European weaknesses. The situation does not look better. Angela Ahrendts, chief executive officer at Burberry Group, highlighted: “We expect the external global environment to remain challenging.” Undoubtedly, luxury goods companies are looking forward for better days.

Anna Domanska
Anna Domanska is an Industry Leaders Magazine author possessing wide-range of knowledge for Business News. She is an avid reader and writer of Business and CEO Magazines and a rigorous follower of Business Leaders.

Recent Posts

US Space Force allows repurposed SpaceX rocket to launch GPS satellite

US Space Force allows repurposed SpaceX rocket to launch GPS satellite

A GPS navigation satellite built by Lockheed Martin is set to ride a reused SpaceX booster on a launch from Cape Canaveral, Florida, Thursday. It will be the first time a military
4 hours ago
Disney boss says 40 pc ad revenue went to streaming sites, no plans of ad supported Disney+

Disney boss says 40 pc ad revenue went to streaming sites, no plans of ad supported Disney+

Walt Disney CEO Bob Chapel says the company’s advertising revenue for the upcoming fall television season was strong and went up by “double-digits” compared to 2019.
2 days ago
BlackRock ETFs breach $3 trillion mark in May

BlackRock ETFs breach $3 trillion mark in May

BlackRocks’ exchange-traded fund crossed $3 trillion for the first time in May, in sync with the ETF industry’s race to an all-time high of $9 trillion.
2 days ago
Flagship Pioneering, investor in Moderna raises $3.4 billion funds

Flagship Pioneering, investor in Moderna raises $3.4 billion funds

Flagship Pioneering, the bioplatform company, and the venture capital investor in Moderna, today announced that it had raised additional funding of $2.23 billion, which brings its
3 days ago
United to recall furloughed employees as travel recovers

United to recall furloughed employees as travel recovers

The fading of the pandemic and the rollout of vaccines has brought in some good cheer for the floundering air travel industry. More countries have opened up for business and are al
4 days ago
UK’s Sanne agrees to consider Cinven bid

UK’s Sanne agrees to consider Cinven bid

Sanne, a UK fund administration business that provides alternative asset and corporate services, has agreed to hold talks with private equity firm Cinven over a potential £1.4bn t
4 days ago