Burberry surges after strong sales

BurberryBurberry's revival since its share price slump in September has continued after better-than-expected trading in the run-up to Christmas.

The blue-chip stock is now back at levels seen prior to the £1 billion slump in its market value, which was caused by fears that China's appetite for the company's luxury bags and coats may be on the wane.

Latest figures showed healthy demand for its products in store, with revenues up 13% on an underlying basis to £464 million in the three months to December 31. Stripping out changes in space, the growth was 6%.

Shares rose 4%, with Investec Securities lifting its profits forecast by 4% to £410 million for the year to March.

Chief executive Angela Ahrendts said the company had enjoyed a particularly strong week before Christmas, adding: "In an otherwise difficult quarter, core outerwear, men's and digital all outperformed."

Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers, said: "The update has comfortably beaten estimates and various updates from the company since September's shock have done much to reassure investors.

"In particular, strong retail growth was achieved through lines such as men's tailoring and accessories, with the approach to Christmas being very successful."

Burberry's shares were at a record high last summer, prior to the single-day slump of 20% in September.

The group, which has 203 retail stores, 214 concessions, 50 outlet shops and 62 franchise stores worldwide, shocked investors by warning its full-year profits would be at the bottom end of expectations amid challenging conditions.

It said that conditions were still difficult, but added that there were opportunities for growth in certain regions and product categories.
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