Sales growth at British fashion group Burberry continued to ease in the second half but the company said on Wednesday it would deliver better than expected profits for the financial year just ended.
Burberry, whose check raincoats, accessories and fragrances are bought by royalty and soccer fans alike, said underlying revenues grew 6 per cent in the six months to March 31st, down from the 15 per cent growth achieved in the same period a year ago.
The top-line figure came in shy of many expectations, with forecasts typically pegging second-half growth at between 8 and 10 per cent, and total reported sales were just 2 per cent higher.
But chief executive Ms Rose Marie Bravo said profits, to be announced on May 24, would beat forecasts. "Burberry has continued to manage for the bottom line, delivering a solid result for the half," Ms Bravo said in a statement.
Burberry said retail sales rose 6 per cent on a constant currency basis, driven by contributions from new selling space, particularly in continental Europe, although the British market remained soft.
Wholesale income was up 5 per cent as Asian markets proved strong, while licensing revenue gained 8 per cent despite a decline in Japanese aggregate volumes.
Burberry said it planned to increase net selling space by about 8 per cent in the current financial year, while wholesale revenues would be broadly flat, with licensing income easing relative to the second half of 2004/5.
Burberry, which is two-thirds owned by GUS Plc, is expected to post a full-year pretax profit of £163 million, according to analysts.
In November Burberry announced a £250-million share buyback that will preserve the existing ownership structure and return excess cash to shareholders.