Burberry share price wobbles after Q3 trading update

on Jan 14, 2015
Updated: Oct 21, 2019
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British luxury fashion retailer Burberry (LON:BRBY) said in a trading update this morning that it had delivered a ‘strong’ performance in the third quarter, with reported growth rates accelerating, but highlighted a slowdown in the high-margin market of Hong Kong.

The company’s retail revenue in the three months to December 31 rose 15 percent on an underlying basis to £604 million, with the rate of growth unchanged from the first half. Meanwhile, retail sales growth at reported currency rates picked up to 14 percent from eight percent in the first half due to an improvement in foreign exchange.
Burberry, best known for its raincoats with camel, red and black-check patterned linings, revealed that it had registered double-digit growth in the Americas, Europe, Middle East, India and Africa. It added, however, that there was only low single-digit growth in Asia, reflecting “disruption in Hong Kong”. The city has recently been hit by pro-democracy protests, disrupting business in one of the world’s top markets for luxury companies. However, Burberry said demand in mainland China and South Korea remained ‘robust’, with sales growth at a mid to high single-digit percentage.

Burberry’s chief creative and executive officer, Christopher Bailey, commented on the group’s outlook: “Looking ahead, we will bring equal focus to maximising the opportunities of the final quarter – including Lunar New Year – while being mindful of what remains a challenging external environment.”
Burberry shares price swung between gains and loses this morning. After opening almost one percent higher, the stock tumbled and as of 08:53 GMT, it was changing hands at 1,654.00p – 0.60 percent down intraday.
According to the Financial Times, of the 22 analysts projecting 12 month price targets for the FTSE 100-listed fashion group the median target is 1,665.00p, with a high estimate of 2,170.00p and a low of 1,460.00p. As of 12 January 2015, the consensus forecast amongst 41 polled investment analysts covering Burberry has it that the company will outperform the market.
As of 09:07 GMT, Wednesday, 14 January, Burberry Group plc share price is 1,654.00p.

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