LONDON, United Kingdom – The Burberry Group has reported higher than expected fourth-quarter revenue, beating analysts’ estimates and resulting in the biggest stock gain since November 2012. Sales climbed by 15% in Asia-Pacific, 10% in the Americas and 4% in Europe, totaling 503 million pounds compared to the 485.1 million pounds predicted by analysts.
Even though Burberry is “expecting the global environment to remain challenging”; the company plans to open 25 new stores with a heavy focus on China and Latin America. However, Burberry is expecting a decrease in wholesale due to store closures and the removal of some entry-price products as well as a decrease in store foot traffic.
The news contrasts with the performance of rivals such as LVMH Moet Hennessy Louis Vuitton SA and Prada SpA.
Paris, France – LVMH Moet Hennessy Louis Vuitton SA fell to the lowest price in four months after reporting a slow down in growth. Revenue rose by 3% in the last three months, making it the weakest quarterly rate since late 2009.
The demand for Louis Vuitton, the conglomerates most profitable unit, slowed as demand for its handbags softened. The fashion retailer is including more leather and increasing the presence of products with fewer logos, as Vuitton seeks to make its brand more desirable while also opening fewer stores.
The slow down has been attributed to the economic crisis in Europe, fewer tourism and the threats of nuclear strikes by North Korea. The group stated that it will try to maintain strict control over costs and focus on quality, excellence and innovation. LVMH first-quarter sales climbed 6 percent to 6.95 billion euros, sales rose by 7%, only half of last years increase.
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