Cool Britannia puts Burberry back on track
Robyn Duffy, Consumer Markets Senior Analyst at RSM UK, comments on today’s results from Burberry: “Today’s results which cover the crucial Christmas trading period see quarter-on-quarter improvement for Burberry. Even as the business faced much tougher year-on-year comparisons in Q3, showing the brands turnaround strategy is on track. Operating profit continues a promising trajectory beating expectations due to better inventory positioning and tighter controls on costs.
“With all regions delivering positive store sales for a second consecutive quarter, momentum is clearly building. Asia Pacific and Greater China are showing particular promise, with store sales in China doubling quarter-on-quarter to 6%.
“CEO Joshua Schulman’s ‘Burberry Forward’ strategy and the refocus on ‘timeless British luxury’ appears to be landing. By re-anchoring the brand around its heritage and core proposition, Burberry is seeing sales in core product lines improve – namely outerwear, and this is now broadening demand across accessories and ready to wear.
“However, risks remain. Tariff threats from the US pushed European luxury stocks to a three-month low earlier this week, underlining the sector’s sensitivity to geopolitical uncertainty.”