British luxury brand Burberry hiked its dividend by 16 per cent after strong growth in the Asia Pacific region helped the company register record annual revenue and profit in 2012/13.
Total revenue in the 12 months ended March 31st rose 8.0% from £1,857m to £1,999m, slightly above Credit Suisse's £1,997m forecast.
Adjusted profit before tax was up 14% at £428m, ahead of Credit Suisse's £417.5m forecast. However, reported profit before tax was down 4.0% at £351m after accounting for exceptional items, including £83m of termination costs of its fragrance and beauty licence relationship with Interparfums.
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The firm raised its full-year dividend by 15% from 25p to 29p per share.
"Finishing the year with a strong retail performance both online and offline, Burberry achieved record revenue and profit in 2012/13," said Chief Executive Officer Angela Ahrendts.
Sales growth was led by strength in the larger Retail division, which grew by 12% to £1,417m. This now accounts for 71% of total sales, (compared with 68% the year before), generated from 206 mainline stores, 214 concessions and 49 outlets.
Despite the strength in Retail, the company did admit that growth was uneven with comparable store sales increasing year-on-year by 6.0%, 1.0%, 6.0% and 8.0% each quarter, a slowdown from the double-digit growth registered in 2011/12.
Store traffic was "soft", though this was offset by increased conversion rates and high transaction values. Online traffic meanwhile was "up significantly".
The Asia Pacific region accounted for nearly 40% of total Retail/Wholesale revenue (37% the year before) and grew by 14% during the year, compared with more subdued growth in the Americas (7.0%) and Europe (1.0%). Nearly 90% of Asia Pacific sales came from Retail with China and Hong Kong registering double-digit comparable store sales growth.
Meanwhile, both Wholesale and Licensing revenues were broadly flat on the year before, though Burberry said that Wholesale sales would drop by 10% in the first half of the current year.
Ahrendts said: "Looking ahead, although the macro environment remains uncertain, Burberry is well positioned with opportunity by channel, region and product. With the integration of Beauty in April, we have added another exciting growth platform. Our brand momentum, proven strategies and closely connected global team provide confidence in Burberry's future performance."
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