British luxury brand Burberry reported a slight slowdown in its fourth-quarter comparable sales growth rate, as tough conditions in the United States weighed on an "exceptional" performance in its home market.
Known for its classic trench coats, Burberry has benefited from tourists taking advantage of a drop in the value of the pound since the Brexit vote in June to buy luxury goods in the British capital rather than other European cities.
Burberry said the British market remained strong and it reiterated its full-year profit target, helped by the boost from the weak pound.
But comparable sales growth rose just 2 per cent in the fourth quarter, below an analyst forecast of 3-4 per cent growth, and below a third-quarter rise of 3 per cent.
"In an uncertain environment, we continue to take action to strengthen the brand and reposition Burberry for growth," Christopher Bailey, chief creative and executive officer, said.
“While we have more to do, as we build on our progress so far, we remain confident about Burberry’s prospects in the longer term.”
Comparable sales in the second half of the year rose 3 per cent, with strength in mainland China driving growth in Asia Pacific and an "exceptional" performance in the UK boosting its Europe, Middle East, India and Africa division.
Sales in the Americas fell by a "mid single-digit" percentage, where the market has turned highly promotional, while important markets including Hong Kong and Korea also declined.
It said it was on track to deliver planned cost savings of 20 million pounds (€23.9 million) in full-year 2017, which would increase to at least 100 million pounds a year in full-year 2019.
-(Reuters)
