Burberry’s FY23 revenue advanced 5 percent at CER and 10 percent on a reported basis to 3,094 million pounds compared to the prior year; while comparable store sales increased 7 percent.
In the fourth quarter, the company’s comparable store sales rose 16 percent, accelerating from 1 percent in the third quarter.
Burberry continues to maintain its guidance of high single-digit revenue CAGR from FY20 base and around 20 percent adjusted operating profit margin at CER for FY24 and 4 billion pounds sales at FY22 CER in the medium-term.
“We have delivered a strong financial performance, supported by good progress in our core leather goods and outerwear categories, with revenue accelerating in the fourth quarter as growth rebounded in Mainland China. Having appointed Daniel Lee as our new chief creative officer, we have refocused our brand aesthetic and brought his new creative vision to life with a campaign and runway show that have been very well received,” said Jonathan Akeroyd, Burberry’s chief executive officer.
Burberry sales recover in the fourth quarter
Burberry saw volatile growth in Asia Pacific during the year due to Covid-19 related disruption in Mainland China in the first quarter and third quarter impacting full-year growth of 2 percent. Mainland China comparable store sales fell 11 percent in the year. The comp store sales decrease of 35 percent and 23 percent, respectively in the first and third quarter was partially offset by comp sales decrease of 1 percent in the second quarter, while the fourth quarter saw recovery of 13 percent comparable store sales growth.
South Korea grew 7 percent in both during the year and fourth quarter, benefiting from over 50 percent of the full price network updated by the year end. Japan also saw comparable store sales growth of 27 percent in the year and 30 percent in the fourth quarter. South Asia Pacific rose over 35 percent in the year with a strong performance in Q4 that increased more than 50 percent, boosted by returning Chinese tourists.
EMEIA comparable store sales rose 27 percent in FY23 and Q4. The region benefited from strong tourist growth with a strong performance from the US, Middle East, and Asia outside of Mainland China. Continental Europe outperformed in the region with the UK broadly in line with the region average Americas fell 3 percent in the year with a deterioration to 7 percent in the fourth quarter.
Burberry reports strong growth among leather and outerwear categories
Burberry reported outerwear comparable store sales growth of 7 percent in FY23 and 30 percent in the fourth quarter mainly driven by rainwear following the brand refresh featuring the heritage range.
Leather goods comparable store sales grew 12 percent in the year and 15 percent in the fourth quarter driven by bags especially from the continued success of Lola campaign and the Frances shape, as well as men’s leather goods.
Ready-to-wear excluding outerwear saw growth broadly in line with the group average for the year with, women’s increasing double digits while men’s saw mid-single digit growth.
During the year, the company opened 21 full price stores, closed 25 stores with one outlet opened and two closed. Including refurbishments, the company increased the number of updated stores by 60 with key openings/refurbishments including Northpark Dallas in USA, Taipei 101 and Nanjing Deji Plaza in Mainland China.
Burberry’s wholesale revenue increased 1 percent at CER and 6 percent at reported rates with good growth in EMEIA offsetting pressure in Asia travel retail. Licensing revenue grew 22 percent at CER and 23 percent at reported exchange rates.