Burberry warns of more difficult conditions ahead

Luxury goods group Burberry today reported a 14 per cent rise in first-half sales, but warned that the trading environment is likely to become more difficult.

The firm said total revenues for the six months to 30 September came in at £1.1 billion, helped by strong demand for its trademark trench coat, and double-digit sales growth in the Americas and Asia Pacific.

Although Burberry said negative foreign currency effects have reduced recently, “this benefit will be partly offset by the more difficult external environment”.

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Meanwhile, rival Mulberry – best known for its luxury leather handbags – said trading during the first half was tougher than expected and warned that its full-year profits will be “significantly” below City hopes.

Mulberry said its business had been hit by a fall in spending among tourists, with full-price sales in the UK sliding by 12 per cent to £20.9 million in the six months to 30 September.

Executive chairman Godfrey Davis said: “Despite the current challenges, I remain confident that we will build on Mulberry’s solid foundations and unique brand positioning in the luxury market to restore growth in the medium term.”