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Interim results for 26 weeks ended 26 September 2020

Strategic progress driving good recovery

“Though the momentum we had built was disrupted by COVID-19 at the start of the year, we were quick to adapt, while making further progress against our strategy. While the virus continues to impact sales in EMEIA, Japan and South Asia Pacific, we are encouraged by our overall recovery and the strong response to our brand and product, particularly among new and younger customers. In an environment which remains uncertain, we will continue to deliver exceptional product, localise plans and shift resources, while leveraging the strength of our digital platform to inspire customers.” – Marco Gobbetti, Chief Executive Officer

  • H1 FY2021 saw a 31% revenue fall with adjusted operating profit down 75% and adjusted diluted EPS down 88% (reported diluted EPS down 66%).
  • Recovery underway with sequential improvement in comparable store sales to -6% in Q2 FY2021 from -45% in Q1 FY2021 and returning to growth in October.
  • Q2 FY2021 saw strong double digit growth in Mainland China, Korea and the U.S.; EMEIA, Japan and South Asia Pacific remain impacted by the significant reduction in tourism.
  • Good strategic progress despite COVID, especially in four areas:
  1. Strong response to product with marked increase in the weight of full-price channels YoY
  2. Growth in leather goods – outperforming the average retail comp
  3. Excellent growth on digital, up high double digits
  4. Good brand traction as we attract new and younger customers
  • Performance underpinned by rigorous management of cost and cash with long term financing in place with the issue of a sustainability bond.
Period ended 26 Sept 28 Sept % change  
£ million 2020 2019 Reported FX CER*
Revenue 878 1,281 (31) (30)
Retail comparable store sales* (25%) 4%    
Adjusted operating profit* 51 203 (75) (71)
Adjusted operating profit margin 5.8% 15.9% (10.1%pts) (9.3%pts)
Reported operating profit 88 202 (56)  
Adjusted Diluted EPS (pence)* 4.6 36.9 (88)  
Diluted EPS (pence) 12.2 36.4 (66)  
Free cash flow* (45) (29)    
Dividend (pence) 0.0 11.3    

*See page 14 of the statement for definitions of alternative performance measures

Outlook FY2021

We are encouraged by the recovery in Q2 FY2021 but remain conscious of the uncertain macro-economic environment caused by COVID-19. We currently have more than 10% of our stores closed globally following the recent lockdowns in EMEIA. With the brand resonating and attracting new and younger consumers, we have taken the decision to reduce markdowns and this will be a revenue headwind in H2 FY2021 with the main impact in Q3 FY2021 but will serve the long term interest of the brand. We are well positioned to continue to drive performance and deliver growth in the medium term.

Read the full statement here