Burberry Ltd. (London) announced that results for the first half of its fiscal year exceeded market expectations.
Operating profit for the six months ended Sept. 30, 2002, were 40.5 percent higher than a year earlier. (The 2002 profit excludes one-time charges for the effects of currency fluctuations and for costs related to the initial stock offering in July, when the company's parent — GUS, the British retailer — sold 22.5 percent of it to the public.) Revenue in the half-year rose 15 percent.
The company credited an expansion strategy based on acquisitions, new stores and new offerings like sleek handbags and children's clothing bearing its signature plaid pattern. The strong performance comes in a year when many rival fashion companies are suffering from economic sluggishness and from tourists'staying home because of the threat of terror attacks.
Rose Marie Bravo, Burberry's ceo and the architect of its metamorphosis from a dowdy raincoat maker to a fashion house, said that she saw no signs of a slowdown. “There is so much more we can do with this brand,” she said. Burberry has also added accessories like handbags, which yield higher margins than clothing, as well as a line of children's wear to expand sales.
It has opened five new Burberry retail outlets in the last six months, including a flagship store on E. 57th Street in Manhattan. The New York store uses glass, slate and strategic lighting to form a pattern on its facade that echoes the Burberry plaid. In the store's penthouse level, which is devoted to men, shoppers can have a drink in a private club area while they wait for tailoring.
Burberry also has plans to reintroduce its Thomas Burberry brand, which was shelved by Bravo several years ago when she was reformulating the Burberry image. Intended to rival Armani Exchange or Polo Jeans, the new Thomas Burberry line will be introduced for fall/winter 2003, Bravo said, and will be sold in department stores and specialty stores.
“Thankfully, men are getting dressed again,” Bravo said.
The company was founded nearly 150 years ago by Thomas Burberry, and its trademark gabardine-checked fabric lined the “trench” coats worn by British soldiers in World War One. Today, it owns and operates nearly 70 stores around the world and also sells its men's and women's designer apparel and accessories under the Prorsum and Burberry London names in high-end department stores. Burberry has also recently expanded into baby clothes, blue jeans and personal products.