Sector movers: Burberry caps strong year
Fashion retailer Burberry saw revenue increase strongly in the second half of its financial year despite an increasingly challenging external environment.
Total revenue increased by 18% on an underlying basis in the six months to 31 March 2008, with retail revenue 17% higher and whole revenue up 25%.
Comparable store sales growth on the retail side was 6%. The company increased retail selling space by 12%, with nine new mainline stores and just under 40 concessions opened during the period.
On the wholesale side, North America and emerging markets outperformed, compensating for sluggish growth in Spain. The company expects around 10% wholesale revenue growth in the first half of its next financial year.
In both retail and wholesale, non-apparel goods saw strong sales growth, driven by demand for handbags, shoes, soft accessories and men's accessories.
Licensing revenue was unchanged in the second half from the first half, with the weakness of the yen compensated for by the strength of the euro.
"We are thrilled with the momentum of our brand as our core luxury, retail and non-apparel
strategies continue to gain traction, while our seasoned management team focuses on improving the operational aspects of our business," said Angela Ahrendts, chief executive officer.
Shares in Carphone Warehouse fell heavily today after full year profits fell short of analysts' expectations and fewer customers signed up for broadband connections.
Carphone said it expects full-year pre-tax profits of between £210m and £220m, compared with previous estimates of £225m and slightly below analysts' expectations.
New broadband connections also missed targets, totalling 109,000 broadband connections in the first three months of 2008, compared with forecasts of 128,000.
Chief executive Charles Dunstone said net debt at the year end increased due to a combination of sterling's weakness against European currencies and the company increasing expenditure on customer recruitment. Such expenditure was aimed at increasing future margins, he said.
"We have accelerated our investment in network capacity to protect and enhance margins over the long term," he said.
He continued: "Operating cash flow grew strongly and will continue to do so in the coming year, but we will continue to invest to build the best possible platform for sustainable long term growth and value creation for shareholders."
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Carphone said mobile phone subscriber numbers increased 12% in the fourth quarter despite a slower consumer environment, to 2.7m in the 13 weeks ended 31 March.
Top performing sectors so far today
Personal Goods 7,392.60 +6.95%
Food & Drug Retailers 4,877.90 +6.83%
Automobiles & Parts 4,560.50 +3.96%
Health Care Equipment & Services 4,083.00 +3.86%
Pharmaceuticals & Biotechnology 7,034.70 +3.41%
Bottom performing sectors so far today
Fixed Line Telecommunications 2,829.20 -0.88%
Industrial Transportation 2,881.80 -0.56%
General Retailers 1,453.70 -0.49%
Insurance (non-life) 1,136.70 -0.49%
Travel & Leisure 4,630.50 -0.25%
