Shares in Burberry (LON: BRBY) have spiked this morning after the the global luxury brand reported that it was on track to meet expectations.
Shares of Burberry spiked 4.03% to 2,143p after the announcement was made on Thursday. 14/11/19 10:54BST.
Burberry reported impressive revenue gains of 3% to £1.3 billion in the interim period, which caught shareholder appetite.
Additionally, profit before tax climbed 11% from £174 million to £193 million.
Shareholders would have been further pleased as the clothing brand saw earnings per share increase to 36.4p an increase from 31.6p a year ago.
As a result Burberry increased its dividend by three per cent to 11.3p.
The reports came as a surprise for both shareholders and market analysts as Burberry are in a period of operational and structural development.
Chief executive Marco Gobbetti said: “We are pleased with our performance in the half, as we remain on track to deliver the first phase of our strategy. New product now represents a high proportion of our assortment and the customer response has been positive delivering strong double digit growth.
“We also continued to strengthen momentum around our brand and transform our distribution. We delivered financial results in line with guidance despite the decline in Hong Kong and we confirm our outlook for FY 2020.”
Burberry said new products designed by Ricardo Tisci has boosted sales, offsetting the effect of “considerable disruption” in Hong Kong where sales plunged.
However, sales in mainland China, Korea and Japan increased, along with the UK, Europe and the US.
Steve Miley, senior market analyst at Asktraders.com, said: “Burberry’s designer Ricardo Tisci’s new collections have proved to be a hit helping Burberry through an otherwise difficult trading environment.
“Despite political disruption in the key market hub Hong Kong which experienced double digit decline in sales, an economic slowdown in China, and Brexit uncertainty Burberry is still on track to meet full year expectations.
Additionally, the ongoing saga between Hong Kong and China have led to violent demonstrations but the FTSE100 (INDEXFTSE: UKX) listed firm managed to overcome these to stun the market.
At time where brands such as Laura Ashley (LON: ALY) and the clothing sector off Marks and Spencers (LON: MKS) have seen slumps, these impressive reports will make good reading for shareholders of Burberry.