A 26 per cent increase in Burberry's adjusted half-year profit failed to allay concerns that the boom in demand for luxury goods in emerging markets could be about to run out of the steam.
Underlying retail sales growth of 16 per cent was certainly more pedestrian that investors have grown used to from the luxury goods group. Chief executive Angela Ahrendts remains unperturbed, though, and continues to push ahead with Burberry's drive into emerging markets, which now account for 19 per cent of its retail and wholesale revenues, up from 13 per cent a year earlier. Asia Pacific remains a key region and, after growing sales by 52 per cent over the period, it now accounts for a third of total sales, up from a fifth just five years ago.
That performance was driven by strong sales in Hong Kong and China which, after the acquisition of its partner there last year, now generate 10 per cent of group revenues. China will feature among the 10 "flagship" stores it plans to open next year as part of an accelerated £180-£200m capital expenditure programme, which will focus on the world's 25 major tourist cities.
Broker Seymour Pierce expects full-year pre-tax profit £375m and EPS of 62.5p (2011: £298m/48.9p).
BURBERRY GROUP (BRBY) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,352p | MARKET VALUE: | £5.93bn | |
| TOUCH: | 1,352-1,353p | 12-MONTH HIGH: | 1,610p | LOW: 983p |
| DIVIDEND YIELD: | 1.6% | PE RATIO: | 25 | |
| NET ASSET VALUE: | 171p | NET CASH: | £174m | |
| Half-year to 30 Sep | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 641 | 128 | 21.5 | 5.00 |
| 2011 | 830 | 159 | 26.7 | 7.00 |
| % change | +29 | +24 | +24 | +40 |
Ex-div:28 Dec Payment:27 Jan | ||||
