Burberry First-Half Sales Miss Estimates as Asian Sales Drop

LONDON, United Kingdom — Luxury-goods maker Burberry Group Plc reported first-half revenue that trailed analysts' estimates as sales declined in Asia.

Revenue was little changed at 1.11 billion pounds ($1.7 billion) in the six months through September, London-based Burberry said Thursday in a statement. Analysts predicted 1.16 billion pounds, based on the average of estimates compiled by Bloomberg. Second-quarter retail sales climbed 1 percent on a comparable basis, the slowest pace since the second quarter of fiscal 2013.

Luxury-goods makers are struggling on multiple fronts. Sales have cooled in China following a clampdown on extravagance. Demand has slumped in Hong Kong and Macau as wealthy Chinese shop in Japan and Europe instead. And the devaluation of the yuan and the Federal Reserve’s decision to hold off from raising interest rates have added to concerns about growth, with LVMH Moet Hennessy Louis Vuitton SE this week attributing slowing fashion and leather-goods sales to stock market volatility.

Burberry is in a weaker position than most. The maker of 45-pound scents and 1,995-pound shearling trenchcoats gets more than 30 percent of revenue from Chinese consumers, yet only 2 percent from Japan, where many are shopping. And the U.K. accounts for about 40 percent of European retail sales when many shoppers with dollars in their wallets are taking advantage of a weaker euro, according to MainFirst Bank AG.

“In the second quarter, demand from luxury consumers, particularly Chinese customers, was affected by a more challenging external environment,” Burberry said in the statement, which was published before European markets opened.

The company said it expects full-year adjusted pretax profit will be “broadly in line” with an average of analyst forecasts of 445 million pounds.

The shares fell 0.8 percent to 1,419 pence in London on Wednesday.

By Andrew Roberts; editors: Matthew Boyle, Paul Jarvis, Thomas Mulier.