From Your Personal Shopper in London: Burberry’s second half sales up 18%

The increase was driven by strong sales in Britain, France and China, and the company said it was positive on the year ahead.

The 156-year-old seller of raincoats and leather goods reported total revenues of £1.027 billion sterling for the six months to the end of March.

This was in line with analysts’ average forecasts of £1.03 billion.

The company said retail revenues, which now account for 72% of group sales, rose almost a quarter to £743m and that the outlook was good.

Wholesale and licensing sales rose 7% and 5% in the second half of the year, respectively.

Angela Ahrendts, Chief Executive Officer, commented:

“With underlying revenue up 18% in the second half, we are pleased with Burberry’s finish to the year across all channels, regions and product divisions. Looking ahead, while we remain vigilant about the external environment, our global teams continue to focus on optimising our core brand, digital and cultural initiatives, while investing to drive sustainable, profitable growth.”

Retail

Retail sales, which accounted for 72% of total revenue in the second half, grew by 23% on an underlying basis (up 25% at reported FX).

Comparable store sales in the half increased by 12% (Q3: +13%; Q4: +11%). The UK, France and Greater China remained strong, especially in flagship markets. In mainline, average retail selling price was again the key driver of sales growth, helped by greater penetration of Burberry London in both women’s and men’s apparel. Knitwear, men’s tailoring and accessories grew strongly, as did fragrance and watches.

During the second half, Burberry opened 11 mainline stores and closed six. Openings included an 11,000 square foot store in Taipei, the first flagship in this market, an 8,000 square foot flagship in Paris, a third store in Brazil and a second in Mexico. Average retail selling space for the second half increased by 13%.

Wholesale

Wholesale revenue in the second half increased by 7% at constant and reported FX, compared to guidance of mid single-digit percentage growth. Growth was impacted by the planned shift from wholesale to retail in Saudi Arabia and Spain and further rationalisation of the brand’s distribution in the United States and Europe.

Excluding these actions, there was double-digit percentage growth in Emerging Markets, Asia Travel Retail and US department stores, driven by brand momentum and new dedicated shop-in-shops. Core outerwear and large leather goods performed solidly, helped by replenishment.

Licensing

Total licensing revenue in the second half increased by 5% on an underlying basis (up 10% at reported FX), consistent with full year guidance. Japanese licence income was slightly down in the half, largely reflecting the planned termination of certain non-apparel licences. There was excellent growth from the three global product licences (fragrance, watches and eyewear), led by the new Burberry Body fragrance and current season watch collections.

Discussions continue between Burberry and Interparfums regarding the potential establishment of a new operating model for the Burberry fragrance and beauty business.

Outlook

Retail: In the year to 31 March 2013, Burberry plans a 12-14% increase in average retail selling space, with a shift from smaller to larger stores, especially in flagship markets. Burberry expects to open about a net 15 mainline stores, biased towards Emerging Markets and cities with high tourist inflows.

Wholesale: In the six months to 30 September 2012, Burberry projects underlying wholesale revenue to increase by a mid single-digit percentage. Despite further rationalisation of the brand’s distribution in both Europe and the United States, double-digit percentage growth is again expected in key US department store doors, Emerging Markets and Asia Travel Retail.

Licensing: In the year to 31 March 2013, Burberry expects licensing revenue at constant and reported exchange rates to be broadly unchanged year-on-year. The global product licences are again expected to deliver double-digit percentage growth. This will be offset by the planned termination and downsizing of Japanese non-apparel licences.

From Your Personal Shopper in Milan: Fashion Veterans Launch New Label Buchanan & Zavala

There’s a new knit in town that is sure to turn heads: Buchanan & Zavala launches its high-end, luxury knitwear collection. The contemporary line appeals to today’s modern woman offering style, comfort and a splash of attitude available for the fall/winter 2011-2012 season. The collection consists of eight silhouettes featuring 60 pieces with prices ranging from $325 to $1,895.

Buchanan & Zavala was born from a combination of industry veterans and powerful executives and has the backing of one of the biggest department stores in the United States: Neiman Marcus.

President and Chief Executive Officer Soo Buchanan collaborated with Executive Vice President of R&D/Operations Roberto Zavala and Vice President of Design Maria Lopez, both former St. John executives, to create a line that provides a wider breadth of selection in the luxury knitwear category. The result is modern classics with flair and also a forgiving fit. These defining characteristics combined with meticulous detailing give each piece its own unique one-of- a-kind feel. The designs carry a rich look and sumptuous texture with sleek lines, modern cuts and intricately knitted yarns.

“My vision for Buchanan & Zavala is sophisticated, stylish yet simple fashion for today’s woman; comfortable for her fast paced lifestyle and beautifully designed,” said Buchanan & Zavala President and CEO Soo Buchanan. “We have assembled a considerable team, with the industry’s foremost design, yarn and manufacturing experts. Women can look forward to great things from the Buchanan & Zavala label.”

Buchanan & Zavala has been meticulous in ensuring that every aspect of the garment is of the utmost quality. The label incorporates the latest in knitting and strives to stay ahead of the technology with its association with the global industry leaders. Using the finest base and accent yarns from Italy and the U.S., and with manufacturing done all in the U.S., Buchanan & Zavala creates textures, colors and structures that not only look sensational, but keep their shape and comfort.

From your Personal Shopper in Milan: CINTHIA, the New Innovative Knitwear Label

After fifteen years of experience as a product manager and designer for one of the most  important  knitwear Italian brand, the Italian Designer Cinzia Michelotto launches a new innovative knitwear label: CINTHIA

The mission is to provide uncompromised quality for the most sophisticated and demanding clients.

Cinthia‘s Collection proposes timelessly elegant accessories, made exclusively in Italy using the skill and experience of time-honored craftsmanship. Quality is carefully controlled at every step, from the selection of the best materials, to final production.  Attention is given to details of every single piece of the collection.

Cinthia uses the finest Italian wools and it is perfect if you are looking for something unique with a vintage inspired style.

The collection will be launched at the White Show in Milan starting from February 25th, 2012.