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Burberry has reported a 36% rise in profits for the 26 week period ending 29 September 2018, despite seeing a drop in revenues.
Sales declined 3% during the period to £1.22bn compared with the £1.26bn recorded the previous year, however operating profit jumped 36% from £127m in 2017 to £173m in 2018.
It also reported a free cash flow of £46m (H1 2018: £171m) which was “largely impacted by an inventory outflow reflecting the ongoing product transition and a seasonal build”.
The luxury fashion retailer also reported that comparable store sales increased by 3%. The company is maintaining its FY 2019 guidance including delivery of cumulative cost savings of £100m.
The results are the first since chief creative officer Ricardo Tisci replaced Christopher Bailey, Burberry CEO Marco Gobbetti said the response to Tisci’s new vision has been “exceptional”.
Gobbetti, CEO said: “We are energised by the early results as we begin to transform and reposition Burberry. The initial response from influencers, press, buyers and customers to our new creative vision and Riccardo’s debut collection Kingdom has been exceptional. Mindful that we are only in the first phase of our multi-year plan, we continue to manage dynamically through the transition. We confirm our outlook for the full year.”
The results also come after it was announced Burberry would stop the practice of destroying unsaleable products and using fur with immediate effect back in September.
