At the time of J immy Choo's (CHOO) interim results last summer we were left unconvinced about both the group's bet on a long-term return to growth in Asia and the brand's global reputation. Now, given the fact the company recoups an awful lot of sales from overseas shoppers, the equity market is treating it far more favourably.
The share price has rallied since last August's results and a recent trading statement helps explain why. Current foreign exchange rates are working in Jimmy Choo's favour - especially as the weak pound has drawn more tourist shoppers to the UK. But Chinese customers are also starting to shop more in their home markets, while bosses also cite good "brand strength" across the US and the rest of Europe.
All in all, retail sales rose 17 per cent in the 2016 calendar year at actual exchange rates and 4 per cent at constant currency. At the group level, that translated into an overall underlying growth rate of 2 per cent. The negative impact from ongoing store renovations and global pricing adjustments also appears to be waning. Better retail sales compared to wholesale and licensing have also boosted gross margins. As such, analysts at Liberum have upped their full-year pre-tax profit forecasts by 2.7 per cent.
