Burberry today struck an upbeat note on its prospects in China, as an emerging army of luxury shoppers in the Asian country helped to drive a sharp uplift in annual profits.
The luxury brand also revealed strong menswear sales last year, and said it will showcase its latest lines for men at a fashion event in London in June, following more than a decade in Milan.
Burberry plans to open three stores in Shanghai this financial year but its chief executive also stressed the growing importance to its business globally of travelling Chinese shoppers.
The brand issued a profits warning last year, partly due to slower sales in China which had been growing at a breakneck pace of 30% in 2011. Boosted by 11 new stores, Burberry still grew revenues in China by 20% last year which the group’s chief executive Angela Ahrendts hailed as an “outperformance” compared with rivals in China.
She said: “This is the new norm there. There has been a lot of government and policy changes, and we are thrilled to be up by 20% and we continue to invest [in China].”
Ahrendts added: “There are 100 million consumers who will travel outside of mainland China over the next couple of years”.
Burberry grew underlying profits by 14% to £428 million in the year to March 31. This was driven by its Asia-Pacific engine, which lifted revenues by 13% to £745.3 million over the year, although it also enjoyed robust growth in the US, France, Germany and India.
Revenue jumped by 8% to £2 billion, and the group grew its full-year dividend by 16% to 29p. Last year, Burberry took its perfume operation in-house by ending its contract with partner, Interparfums, the French company also responsible for fragrances belonging to Jimmy Choo and Montblanc.
