Burberry keeps targets after H1 profit jump

LONDON - British luxury goods group Burberry met forecasts with a 26 percent rise in first-half profit, helped by buoyant tourist spending around the world, and kept its growth targets despite an uncertain economic backdrop.

Burberry Prorsum AW 2011-12 / Photo: Pixel Formula

"We remain mindful of, and prepared to react to, any local or global uncertainties," said the 155-year-old maker of raincoats and leather goods, which responded rapidly to the 2008-9 recession by cutting jobs and inventories.

Burberry, best known for its camel, red and black check pattern, said on Tuesday it made a profit before tax and one-off items of 162 million pounds ($258 million) in the six months ended Sept. 30, broadly in line with analysts' average forecast of 159 million in a Reuters poll.

Last month the group beat forecasts with a 29 percent increase in second-quarter revenue and said it was seeing no sign of slowing demand.

Luxury shares have wobbled in recent months amid a slowdown in economic growth in China -- the engine of recent strong demand for high-end goods -- and fears the euro zone debt crisis could drag the world back into recession.

Industry heavyweights like LVMH, PPR, Hermes and Hugo Boss have calmed nerves with strong sales figures in recent weeks. However, Cartier jewellery-maker Richemont on Friday struck a cautious tone about the outlook.

Burberry said it was sticking to its goal of increasing retail selling space by about 15 percent in the second half, including eight to 10 mainline stores in areas like China and Latin America and a new flagship shop in Paris.

The group said it had net cash of 174 million pounds and hiked its interim dividend by 40 percent to 7 pence a share.

Burberry shares have bounced back from their October low of 1,034p but are still trading below their July record high of 1,610p. They closed at 1,421p on Monday, valuing the business at about 6.1 billion pounds. ($1 = 0.629 British Pounds) (Reporting by Mark Potter; Editing by James Davey)