Tisci has been driving Burberry’s positive business trend in Hong Kong. Sales of products created by the Italian fashion designer provided the British brand with a valuable support, therefore offsetting the downturn in sales, throughout the first half-year, in the British ex-dominion. At the end of the period, Burberry revenues turned out to increase by +5%. Accessory items sales have been decreasing though.
Burberry win in Hong Kong
At the end of the first six months of 2019, Burberry earnings, coming from sales, amounted to 1.281 billion pounds (that is, +5% at current rates of exchange). Comparable sales have been rising by 4%. Adjusted operating profits, made by the British brand, went up by 17%, therefore reaching 202 million pounds.
The accessories trend
Burberry have been setting and implementing a long-lasting renovation plan, which is currently going through year two. While facing this early stage, the primary aim is to revamp the brand and bring distribution in line with the company’s new market position, in order to create a new product supply. “Accessories sales trend – they announced in a press release – proved less brilliant, compared to the previous year (-5% at fixed rates of exchange), though things have been going considerably better throughout the period. Buyers offered a positive feedback to our bags, and we kept developing, in the meantime, a wider range of articles”. It turns out that accessories are the top-driving product category, in terms of overall turnover, as revenues coming from their sales account for more than one third.
“We are happy about our performance. We are on the right path to go through with the first stage of our business strategy – remarked Marco Gobbetti, Burberry chief executive officer –. Our new product (created by Tisci, editor’s note) currently accounts for 70% of our sale supply. Feedback proved positive as revenues remarkably went up in double figures. The financial achievements we have reached are in line with our expectations, despite the Hong Kong downturn (in double figures). We therefore confirm our outlook for 2020 business year”. Burberry also announced the launch of an exclusive and innovative partnership with Tencent, to build up the social retail channel in China. The first social retail store is due to open in Shenzhen in the first half-year period of 2020.
Picture taken from Burberry’s Facebook account