Burberry H1 revenues fall 31%
Burberry has revealed sales have managed to return to growth in October, after the luxury retailer said revenue for the first half of the year decreased by 31% to £878m.
In the same period, operating profit plummeted 75% to £51m amid the effects of the ongoing pandemic.
The fashion house has since reported some recovery, with a sequential improvement seen in comparable store sales, which were down 6% in the second quarter of FY2021, up from the 45% decline reported in the first quarter.
The group confirmed that sales have returned to growth in October, while “strong” double digit growth was seen in Mainland China, Korea and the U.S in the second quarter of its 2021 financial year.
Burberry said it had also made “good strategic progress” in the period, with a marked increase in the weight of full-price channels, a growth in leather goods, “excellent” growth in digital channels and a stronger brand traction.
It added that its performance was underpinned by “rigorous” cost and cash management alongside long-term financing plans.
Looking ahead, the group said it is encouraged by the recovery seen in the second quarter of FY2021, but nonetheless “remains conscious of the uncertain macroeconomic environment” caused by the pandemic.
In light of this, the business has decided to cut its markdowns in the coming period, which will create a “revenue headwind” in its next half-year results.
CEO Marco Gobbetti said: “Though the momentum we had built was disrupted by Covid-19 at the start of the year, we were quick to adapt, while making further progress against our strategy.
“While the virus continues to impact sales in EMEIA, Japan and South Asia Pacific, we are encouraged by our overall recovery and the strong response to our brand and product, particularly among new and younger customers.”
He added: “In an environment which remains uncertain, we will continue to deliver exceptional products, localise plans and shift resources, while leveraging the strength of our digital platform to inspire customers.”
