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Fashion Jobs
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Reuters
Published
May 20, 2015
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Burberry shares slide on lower 2016 outlook

By
Reuters
Published
May 20, 2015

British luxury goods maker Burberry lowered its 2016 retail and wholesale profit guidance due to foreign exchange movements and said it was seeing increased uncertainty in some markets, taking the shine off forecast-beating results.

The 159 year-old firm, which is known for its raincoats with camel, red and black-check patterned linings, posted a 7 percent rise in underlying full-year pretax profit to 456 million pounds ($706.48 million) on Wednesday, slightly ahead of forecasts.

But the group noted that it was continuing to be hit by currency fluctuations, following the strength of the U.S. dollar, the weakness of the euro and the surge in the Swiss franc earlier this year.

Shares in the company fell by around 5 percent in early trade to 1,710 pence, making it the biggest faller on the FTSE index.

"At this early stage of the year, we are seeing increased uncertainty in some markets," said Chief Creative and Chief Executive Christopher Bailey.

For its full-year results, Burberry said it had seen significant impact from exchange rates, reducing reported revenue by 72 million pounds and adjusted profit before tax by 38 million pounds.

The company said its expectation for its reported retail and wholesale profit for the new financial year 2015/16 would be around 40 million pounds lower than previously guided, due to the movement in exchange rates.

Burberry said the focus on its British-made trench coats and cashmere scarves had a been a principle driver of this year's growth, as well as its investment in digital which outperformed across all its regions.

It raised its full year dividend by 10 percent to 35.2 pence per share.

£1 = $1.55

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