Burberry Group plc Solid performance in retail

Burberry Group plc (LON:BRBY) today announced first quarter trading update

Continued progress executing plan with comparable sales +3%

Burberry Group, Marco Gobbetti, Chief Executive Officer, commented:

“We are pleased with our progress in the quarter. The team has embraced Riccardo’s creative vision and is working well together as we prepare for his debut collection in September, the next step in our journey. While we know it will take time to achieve our ambitions, our progress to-date and the energy in and around the company give me confidence for the future.”

Highlights

· Solid performance in retail in a period of transition, with comparable sales +3%

· Strategically investing in key markets including relocating and expanding our flagship store in Dubai and closing an additional two outlets

· Pop up stores showcased new handbags in Beijing, Dubai, New York and Seoul

· Completed global roll out of new digital clienteling tool supporting enhanced customer service

· Farfetch collaboration performing ahead of our expectations

· Announced moving to a new model of engaging consumers with frequent and sometimes unexpected drops of fresh product, including:

– Limited-edition pieces from Riccardo’s inaugural collection available to buy through a series of instant drops from September

– Vivienne Westwood collaboration of re-imagined iconic styles to launch in select stores in December

· Luxury leather goods acquisition proceeding as planned

· Commenced £150m share repurchase programme

First quarter retail performance

· Growth led by local and returning top customers

· Newly launched handbags, such as the Belt and D-ring performed well, a positive early sign for the transformation of our leather offer

· Refreshed heritage trench rollout is now live in over 80 stores

· Rainwear grew with strength from Car Coats and seasonal tropical gabardine

· Customers are responding to our more complete wardrobe offer and full look merchandising

Retail revenue 13 weeks to 30 June

*Growth at CER includes marginally negative net space contribution, impact of retail calendar +0.2% and IFRS 15 -0.5%. For more detail see Appendix

· Comparable sales +3%

– Asia Pacific grew by a mid-single digit percentage

Mainland China grew and Hong Kong, Korea and Japan all benefited from Chinese spend shifting more to Asian tourist destinations within the region

– EMEIA declined by a low single digit percentage

Softer tourist demand impacted both the UK and Continental Europe and the Middle East remained weak due to macro factors

– Americas grew by a high single digit percentage

Improved trends seen in the fourth quarter of FY 2018 continued, with footfall in the US positive

– Strong growth in digital

Direct-to-consumer growth was led by Asia Pacific and mobile is now the largest digital channel

FY 2019 outlook

· No change to guidance at CER, some easing of currency headwind at current rates*

· On track to deliver cumulative cost savings of £100m