Burberry reports sales boost from trench coats and says turnaround ‘working’

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Burberry has revealed demand for its signature trench coats helped drive sales higher in the first half of the year as it hailed improvement in the Chinese market.

Shares in the British luxury fashion house surged around 8% on Thursday morning after it said its turnaround strategy, which was launched two years ago, is “working”.

Reporting on its half-year results, the company said revenues grew by 6% to £1.1 billion for the six months to September 26, compared with the same period last year.

Sales grew across womenswear, menswear, childrenswear and accessories ranges.

It highlighted sales growth in the double-digits for outerwear – meaning coats and jackets – including its gabardine trench coat style, as well as new cashmere and leather products.

Burberry, which had 412 stores globally at the end of September, said sales in Greater China grew by 7% in the first half, driven by local spending as well as intraregional tourism.

It said this showed a stronger performance in a “challenging market” where the brand has previously grappled with waning demand for luxury goods.

It also flagged sales rising by more than a 10th across the Americas and in South Korea.

Burberry returned to an annual profit last year and revealed this progress had continued over the past six months, swinging to a pre-tax profit of £19 million from a £48 million loss the year before.

Chief executive Joshua Schulman said the group’s turnaround strategy is paying off in an “uncertain environment”.

He said: “Five consecutive quarters of growth and improved quality of sales demonstrate that our strategy is working.

“Having laid the foundations for growth, I am more confident than ever that we will realise the full potential of this extraordinary British luxury brand.”