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LONDON (Alliance News) - FTSE 100-listed Burberry PLC said on Wednesday that annual profit rose as revenue dipped slightly amid a year of "transition".
Revenue declined 1% both at reported rates and constant currency to GBP2.73 billion, with comparable retail stores sales up 3%, as adjusted operating profit rose 2% at reported rates to GBP467 million.
Adjusted operating profit benefited from a "positive" retail performance, GBP44 million incremental cost savings - with the cumulative total now standing at GBP64 million - and improved Beauty profitability due to reduced marketing and inventory charges.
Pretax profit came in at GBP412.6 for the year, up from GBP394.8 last year.
The luxury fashion retailer raised its total dividend 6% to 41.3p from 38.9p last year.
The company said there is no change to its guidance of "broadly stable revenue and operating profit margin" at constant currencies in 2019 and 2020. Burberry will initiate a GBP150 million share buyback in its recently-commenced financial year.
Retail sales rose 3% at constant exchange rates to GBP2.18 billion in the period, which was up 2% at reported rates.
Mainland China delivered high single-digit percentage growth, slowing to mid-single digits in the second half due to strong comparatives, Burberry said. Hong Kong improved through the year, while Korea declined but showed improvement in the second half.
The UK delivered low single-digit percentage growth, with growth in the first half offset by a decline in the second, as expected, the company said. Continental Europe declined marginally with tourist spend softer in the second half.
"In a year of transition, we are pleased with our performance as we began to execute our strategy. While the task of transforming Burberry is still before us, the first steps we implemented to re-energise our brand are showing promising early signs," said Chief Executive Marco Gobbetti, who took over the role from Christopher Bailey last year.
"With Riccardo Tisci now on board and a strong leadership team in place, we are excited about the year ahead and remain fully focused on our strategy to deliver long-term sustainable value," Gobbetti added.
