British luxury goods group Burberry met forecasts with a 4 per cent fall in first-quarter underlying revenues and said today trading conditions remained challenging.
The 153-year-old maker of raincoats and handbags said it had £229 million ($373 million) of revenue in the three months to June 30th, up 8 per cent on the same period last year. At constant exchange rates, revenues were down 4 per cent.
Forecasts ranged from £218 to £239 million in a Reuters poll of seven analysts.
“Burberry has made a solid start to the year in what remains a challenging environment,” chief executive Angela Ahrendts said in a statement.
Retail revenues rose an underlying 12 per cent to $148 million, helped by new store openings and a better-than-expected flat performance in comparable store sales.
Double-digit percentage gains in European and Asian markets, led by Britain and South Korea, were offset by double-digit falls in the United States and Spain.
Wholesale revenues dropped an underlying 28 per cent and Burberry kept its forecast for a first-half fall of 25 per cent. Licensing revenues fell an underlying 3 per cent.
Luxury goods firms have been hit hard in the global economic downturn. However, Burberry, known for its camel, red and black check pattern, responded quickly by cutting costs and around 800 jobs, or about 15 per cent of its workforce.
After plunging as much as 70 per cent last year, Burberry shares have bounced back from a November low of 154.75 pence.
They have outperformed the DJ Stoxx personal and household goods index by 100 per cent this year, and closed at 426.75 pence yesterday, valuing the business at about £1.8 billion.
Reuters