Financial News
INTERIM RESULTS
18 NOVEMBER 2008
Burberry Group plc, the global luxury company, today announces its unaudited results for the six months ended 30 September 2008.
Financial highlights
- Total revenue of £539m up 20%
- Adjusted operating profit of £98.4m up 3%; up 7% excluding new HQ/SAP costs of £3.8m
- Adjusted diluted EPS up 3%
- Profit before tax up 1% and reported EPS up 14%, benefiting from tax adjustment relating to prior years
- Interim dividend maintained at 3.35p
£ million |
Six months to 30 September | % change | |||
|---|---|---|---|---|---|
| 2008 | 2007 | reported | underlying# | ||
| Revenue | 539.1 | 449.1 | 20 | 13 | |
| Operating profit | 100.1 | 97.3 | 3 | - | |
| Adjusted operating profit* | 98.4 | 95.1 | 3 | - | |
| Profit before taxation | 97.0 | 95.8 | 1 | ||
| Diluted EPS (pence) | 17.0 | 14.9 | 14 | ||
| Adjusted diluted EPS (pence)* | 15.3 | 14.8 | 3 | ||
| Dividend per share (pence) | 3.35 | 3.35 | - | ||
* "Adjusted" refers to profitability measures calculated excluding:
1. Profit of £1.7m in 2008 representing negative goodwill on the formation of the Burberry Middle East joint venture.
2. Impact of prior year tax adjustment in 2008.
3. Atlas costs of £nil (2007: £12.9m) relating to the Group’s infrastructure redesign initiative.
4. Net profit of £nil (2007: £15.1m) relating to the relocation of global headquarters.
# Underlying change is calculated at constant exchange rates.
Certain financial data within this announcement have been rounded.
Operational highlights
By channel
- Retail revenue up 21% (14% underlying); comparable store sales growth of 3%; opened a net five mainline stores
- Wholesale revenue up 23% (15% underlying); Americas, Europe and Emerging Markets all performed strongly
- Licensing unchanged (down 3% underlying); good growth in global product licences especially fragrances
By region
- Double-digit growth in all regions, except Spain
- Joint venture formed in Middle East - a high growth Emerging Market
- Joint venture being finalised for non-apparel in Japan – largest luxury accessories market in the world
By product
- Double-digit growth in all product categories
- Non-apparel up 20% to contribute 31% of revenue
- Outerwear and innovative check performed strongly
Outlook
- In line with other luxury companies, trading has become more difficult since start of second half, particularly in the United States
- Peak season trading to come; if initial trends continue, adjusted profit before tax would be in mid to lower half of current range of market expectations
- Cost efficiencies of £15-20m for 2009/10 already identified, enabled by investments made in supply chain, IT and infrastructure; reviewing further significant savings to underpin profitability going forward
- Strategies remain strong to drive outperformance and long-term value creation
Angela Ahrendts, Chief Executive Officer, commented:
"The fundamentals of Burberry remain strong, despite the current very challenging environment. With our supply chain and IT investments in their final phases, we are now in a position to drive significant efficiencies in the near term. These benefits, along with continued investment in the business, our seasoned management team, strong brand perception and proven strategies underpin our confidence in the future long-term growth of Burberry.
I am also delighted today to announce two joint ventures with long-standing partners - the first in the Middle East and the second for non-apparel in Japan – both of which will accelerate our growth in these key regions."
Enquiries
| Burberry | 020 7968 5919 | |
| Stacey Cartwright | Chief Financial Officer | |
| Fay Dodds | Director of Investor Relations |
| Brunswick | 020 7404 5959 | |
| David Yelland | ||
| Robert Gardener | ||
| Rashmi Gautam |
There will be a presentation today at 9am (UK time) to investors and analysts at the Merrill Lynch Financial Centre, 2 King Edward Street, London, EC1A 1HQ. The presentation can be viewed live on the Burberry website (www.burberryplc.com) and can also be accessed live via a dial-in facility on 44 (0)20 3037 9083. The supporting slides and an indexed replay will also be available on the website later in the day.
Certain statements made in this announcement are forward-looking statements. Such statements are based on current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from any expected future results in forward-looking statements.
This announcement does not constitute an invitation to underwrite, subscribe for or otherwise acquire or dispose of any Burberry Group plc shares. Past performance is not a guide to future performance and persons needing advice should consult an independent financial adviser.
View the full Interim Results Announcement in PDF format.
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