Shares in Burberry (LON:BRBY) have climbed higher in today’s session, outperforming the broader UK market, even as the company posted a fall in revenue. Investors, however, have reacted positively to news that the debut collection of the retailer’s new chief creative officer received ‘exceptional’ response.
As of 13:07 GMT, Burberry’s share price had added 2.18 percent to 1,855.50p, outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.38 percent at 7,144.58 points. The group’s shares have given up about six percent of their value over the past year, as compared with about a five-percent fall in the Footsie.
Burberry posts quarterly results
Burberry announced in a statement today that its revenue had dipped three percent on a reported basis to £1.22 billion in the 26 weeks ended September 29, while its adjusted operating profit had come in four percent lower at £178 million.
The group’s free cash flow meanwhile tumbled from £171 million to £46 million during the reported period. Burberry, however, maintained its payout to shareholders at 11.0p per share.
The company maintained its FY 2019 guidance including delivery of cumulative cost savings of £100 million.
“We are energised by the early results as we begin to transform and reposition Burberry. The initial response from influencers, press, buyers and customers to our new creative vision and Riccardo's debut collection Kingdom has been exceptional,” the group’s chief executive Marco Gobbetti commented in the statement.
Analysts weigh in on update
Reuters reported that analysts at Citi had said that the retailer’s turnaround plan was on track.
“While we appreciate the continued focus on new product initiatives, refreshed store concept, sales productivity, ecommerce and cost control, the jury’s still out on the timing and magnitude of brand turnaround,” they said, as quoted by the newswire.