Burberry growth in first quarter disrupted by China lockdowns

Worldwide
Published:  18 July, 2022
Credit: Burberry

Burberry Group has released its financial results for the first quarter of the 2023 financial year, achieving minor sales growth.

Comparable store sales, which Burberry defines as the year-on-year change in sales from stores trading over equivalent time periods and measured at constant foreign exchange rates, increased by 1% overall.

This did not exclude stores affected by Covid-19 restrictions and the company has emphasised this as the reason for its low overall growth. Burberry noted double-digit growth in leather goods and outerwear outside Mainland China.

Excluding Mainland China, comparable store sales grew by 16%, with growth of 47% in the EMEIA region. For the Asia Pacific region, comparable store sales fell by 16% with a decline of 35% for Mainland China alone.

Burberry notes that it began the quarter with around 40% of its distribution disrupted by lockdowns in Mainland China, including its digital hub, but all stores were fully reopened by the end of the period.

Retail revenue was £505 million (US$604 million) for the period ended July 2, 2022, an increase of 5% year-on-year.

CEO Jonathan Akeroyd said: “Our performance in the quarter continued to be impacted by lockdowns in Mainland China but I was pleased to see our more localised approach drive recovery in EMEIA, where spending by local clients was above pre-pandemic levels.

“Our focus categories, leather goods and outerwear continued to perform well outside of Mainland China and our programme of brand activations boosted customer engagement. While the current macro-economic environment creates some near-term uncertainty, we are confident we can build on our platform for growth.”