Burberry reports 3 percent underlying growth in first quarter

Burberry reports 3 percent underlying growth in first quarter

Burberry reports 3 percent underlying growth in first quarter

This is a time of great change for Burberry and the wider luxury industry. I...

Shares in Burberry (LON:BRBY) have jumped about three percent in London in today's session, outperforming the broader United Kingdom market, as the blue-chip retailer posted a rise in first-quarter sales.

As of 09:33 BST, Burberry's share price had surged 3.16 percent to 1,630.00p, outperforming the benchmark FTSE 100 index which is now 0.56 percent better off at 7,370.60 points.

The company said its advertising campaign on WeChat for the launch of a new bag - the DK88, which retails for nearly $2,000 - saw its customer reach triple on the app. Sales growth in the country was in the mid-single digits, above the global growth rate.

Retail revenues were ahead of expectations up by 3% to £478m with strength returning to Asian markets as the United Kingdom leads the way in Europe. The brand still has plenty of growth potential, as it has demonstrated with the success of the DK88 handbag which is selling strongly at over $2,000 a pop as big spenders return to the group's stores.

LONDON-British luxury retailer Burberry Group PLC (BRBY.LN) said Wednesday it is on track to hit its cost savings targets as it reported higher first-quarter comparable sales and underlying revenue.

It said growth over the period had been driven both by fashion and innovation.

"That will hold reported growth back a bit in the near term", Clayton warned.

"But with an acceleration in new product launches set for the second half of the year, the underlying progress at Burberry should improve steadily", he added.

"We believe that some of the challenges faced by the luxury sector over the last few years are fading". FY18 adjusted PBT at constant exchange rates is maintained.

Meanwhile, Burberry has also been under pressure over executive pay.

In 2014, more than half of investors voted against its remuneration report that had recommended a pay rise for Bailey to prevent the former boss from taking a job at a rival designer.

Brown, who joined from medical supplies group Smith & Nephew, was paid £4.7m between January and March 2017, including a golden hello of £4.5m consisting of £4m in shares and £550,000 in cash.

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