Britain’s Burberry beats forecasts after sales rebound

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© Reuters. FILE PHOTO: A Burberry logo can be seen outside the store on 5th Ave in New York

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LONDON (Reuters) – British luxury group Burberry announced on Friday that it would beat market forecasts for earnings and sales for the last quarter after a strong sales rebound since December and bring its stocks to pre-pandemic levels.

In an unscheduled trade update, the company known for its trench coats announced that comparable retail sales for the fourth quarter of fiscal year through March 27 are expected to be 28% to 32% higher than the same period last year.

“We have continued to see a strong recovery since December and now expect sales and adjusted operating income to be above consensus expectations,” it said.

Burberry’s shares rose up to 10% in early deals to their highest level since January 22, 2020. They traded 8.3% at 2,153 pence around 0859 GMT.

For the full year, the company anticipated a 10% to 11% decline in consolidated sales, while the adjusted operating margin would be in the range of 15.5% to 16.5%.

Analysts, on average, had expected consolidated sales to decline 13% at constant exchange rates for the year, according to a consensus created by the company in January.

Burberry, which showed its first menswear-focused collection from designer Riccardo Tisci last month, saw strong sales rebound in mainland China and South Korea.

Growth in Asia has partially offset declines in Europe, where regional COVID-19 lockdowns and travel restrictions have closed stores and deterred tourists.

Rival luxury companies have also rallied in the important Chinese market.

Italian fashion house Prada (OTC 🙂 and luxury goods company Salvatore Ferragamo said this week that strength in China has boosted sales this year.

Burberry will publish its annual results on May 13th.

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