Wavering wholesale demand in the US has hit Burberry’s margins as the retailer posts a five per cent dip in reported pre-tax profits to £394.8 million.
Its EBITDA dropped 21 per cent to £462m, however this came in ahead of analyst’s predictions raising the company’s share price to the highest level in six weeks.
Total revenues were down two per cent to £2.8 billion in the year to March 31, but the weak pound saw the luxury retailers adjusted profits rise 10 per cent in reported exchange rates.
Despite this promising outcome, the impact of the weak pound is predicted to cost the retailer £30 million in the coming year.
The retailer said it was on track to achieving cost reductions of £100 million a year by 2019, reductions that partially offset the waning sales across the US.
“2017 was a year of transition for Burberry in a fast-changing luxury market,” chief executive Christopher Bailey said.
“The actions we have taken to lay the foundations for future growth are yielding early benefits and I remain confident that these will build over time.
“Marco Gobbetti assumes the role of CEO from July. With his extensive experience in the sector, we will build on these foundations to elevate and strengthen the brand further and take Burberry to the next level as a global luxury retail and digital business.
“I am excited to work closely with him in this next chapter.”