� Total revenues increased by 17%, 16% underlying*
� Retail sales up 20% on an underlying basis, driven by new stores
� Wholesale sales increased 14% (13% underlying) reflecting double digit growth for the Autumn/Winter 2003 season
� Licensing revenue up 15% underlying, 13% reported
*Underlying figures are calculated at constant exchange rates and exclude the impact of the July 2002 acquisition of the operations of Burberry's distributor in Korea (the #'Korea acquisition'').
Commenting on the trading results, Rose Marie Bravo, Chief Executive, stated, #'Burberry traded strongly in the first half as the improved conditions at the end of the first quarter continued. Our retail investment, geographic expansion and product development strategies continue to deliver excellent results. With this performance, Burberry's trading is clearly in line with market expectations for the financial year.''
Total revenues in the first half increased by 17% (17% at constant exchange rates), or 16% on an underlying* basis (i.e. at constant exchange rates and excluding the impact of the Korea acquisition) compared to the same period last year.
Total retail sales increased by 25% (boosted by the Korea acquisition) and accounted for approximately 33% of total revenue in the half. On an underlying basis, retail sales increased by 20%. This growth was driven by new stores with a marginal contribution from existing stores. Throughout the period, the US was consistently the best performing market. Burberry's other markets generally experienced varying degrees of recovery during the half.
The Company opened three Burberry stores in the period, in Milan, Tyson's Corner (Virginia) and a second store in Las Vegas. Burberry remains on schedule to open six additional stores during the second half of 2003/04, resulting in selling space expansion in excess of 10% for the financial year. In addition, the Company today announced the first Burberry store in Russia. The 5,000 square foot Moscow store will be operated by a third party and is scheduled to open in early 2004.
Total wholesale sales increased by 14% during the half, driven by double-digit gains for the Autumn/Winter 2003 season. This increase resulted from solid growth across all regions. Notably, sales growth resumed in Spain, reflecting repositioning efforts in that market. On an underlying basis, wholesale sales increased by 13%.
On the basis of orders received to date, Burberry anticipates mid to high single-digit wholesale sales growth for the Spring/Summer 2004 season. The majority of spring/summer merchandise is shipped in the fourth quarter of each financial year.
Total licensing revenues in the half increased by 15% on an underlying basis, and 13% reported. Licensing revenues from the Japanese market reflected increases in certain royalty rates and single-digit volume gains. The volume gain is encouraging in context of the strong growth achieved in the comparable period last year and the lacklustre economic environment. Licensing revenue also benefited from strong sales gains by global product licensees, including fragrances, eyewear and children's apparel. Burberry anticipates a lower rate of licensing revenue growth over the balance of the year.
In close cooperation with Burberry, the Company's licensing partner in Japan recently announced plans to open a second Burberry store in Tokyo. The 6,000 square foot store will be located in the Omotesando district and is scheduled to open in April 2004.
Burberry will announce interim results on 18 November and provide a trading update on third quarter sales on 13 January 2004.