Burberry buoyed by markets demand

Fashion group Burberry is to make a further push into emerging markets and cash-rich regions after strong demand for luxury goods from countries such as China and Russia helped annual profits rise by a quarter. Go to have Lunch!

The firm posted pre-tax profits of ￡195.7 million for the year to the end of March, with like-for-like sales up 8%.

Burberry - famous for its trademark check design - said wholesale revenue doubled from markets such as China, the Middle East and Russia, while North America underlying sales rose 26%.

The group revealed last month that it had become an unlikely beneficiary of the soaring cost of oil, with robust demand for luxury goods from oil-rich customers in oil-producing cities such as Houston and Dallas, as well as petro-dollar regions in the Middle East.

It is now planning to open another up to 10 stores in the United States and 15 to 20 stores in emerging markets to capitalise on the demand for luxury products.

Burberry also thanked new product designs and a push into accessories for the profits boost.

Accessory sales grew by 39% on an underlying basis, up from 28% in 2007. Sales of shoes more than doubled in the year, while handbags also sold well, said Burberry.

The firm is now planning a host of shoes, jewellery and childrenswear launches.

Wednesday’s figures defy wider gloom in the retail sector as consumers cut back on spending, but show the luxury market’s “robustness” in challenging times, according to Burberry chief executive Angela Ahrendts.

Last week Swiss luxury goods maker Richemont - the group behind Cartier watches and Piaget jewellery - also posted strong figures, with full-year profits up 18%. It’s so brilliantly beautiful!

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