LONDON – Burberry reported a robust first half, with revenue and profit both rising in the double digits at reported exchange driven by leather goods sales and the weaker pound.
The new CEO Jonathan Akeroyd also set out a series of punchy targets. His ambition is for revenue to grow to 4 billion pounds in the medium term, and 5 billion pounds in the long term, at constant exchange rates, and with “good” margin progression.
In the first half ended Oct. 1, revenue rose 11 percent to 1.35 billion pounds at reported exchange, boosted by the weaker British currency. At constant exchange, revenue rose 5% year-on-year.
Adjusted operating profit was up 21% to 238 million pounds at reported exchange, and 6% at constant rates. Profit for the six-month period rose 33% to 193 million pounds at reported exchange.
Shares were up 1.8% to 20.38 pounds in late morning trading on the London Stock Exchange.
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Sales of leather goods were up 11% in the first half, with the Lola bag now a bestseller. Sales of outerwear rose 3% in the six-month period.
The past six months have been busy for Burberry. Chief creative officer Riccardo Tisci showed his final collection for the brand at the end of September, and Burberry immediately named designer Daniel Lee to the top creative post. His first collection, for fall-winter 2023, will be unveiled in London next February.
The company said it was maintaining its near-term guidance for the full fiscal year, and is mindful of the macro-economic challenges that lay ahead, including COVID-19-related disruption in Mainland China, and “recessionary risks” in Europe and the Americas.
Later on Thursday, Akeroyd is due to lay out his new strategy to the markets during a live presentation in London. That new vision will include “a refocus on Britishness,” doubling the sales of leather goods, shoes and women’s rtw, and growing outerwear by 50% in the medium-term.
Another of Akeroyd’s ambitions is to grow accessories to more than 50% of group sales in the medium term. He also wants to “accelerate momentum” in core markets, and deliver on the company’s “bold” sustainability commitments.
This story was reported by WWD and originally appeared on WWD.com.
