After all, Burberry considers itself satisfied by the results from the October-December quarter (until the 26th). After all, Covid-19 still makes its presence known on operations, to the point that the British group remains cautious on the forecasts. Moreover, unknowns tied to Brexit must be added to the pandemic, as well as the suspension of the tax-free system in the UK. Burberry considers the sale of full-price items part of the leather goods and clothing lines as a key portion of its strategy, as sales for the categories are increasing among adolescents.
Burberry considers itself satisfied
Despite the challenging external environment, we made good progress on our strategic priorities in the quarter. We saw a strong increase in full-price sales as our collections and communication resonated well with new, younger clientele as well as existing customers- commented the CEO Marco Gobbetti -. While the short-term outlook remains uncertain due to COVID-19, we are well placed to accelerate when the pandemic ceases”. Data divulged by Burberry regarding retail revenue shows that the latter went down by 4% at current rates and by 5% at constant rates. Comparable sales for the same period dropped by 9%, while digital full-price sales increased by over 50%. Sales went up by 11% in Chinese stores, while they went down by 8% in the Americas and by 37% in Europe and Middle East.
“Our collections attracted new customers to the brand, leading to double-digit growth within full-price sales”. The strategy will bring an increment in margins and the reduction of stock. Leather goods also recorded good results, “supported by our ongoing programme of store activations and pop-ups, grew by low teens in full-priced sales in the period”. Burberry also mentioned Brexit’s consequences (“we expect a slight costs’ increase”) and those of the suspension of purchases in tax-free zones by foreign tourists. This will have a “more significant” impact when travel will resume. Burberry is looking for ways to mitigate this impact.