RPT-UPDATE 1-Burberry profit rises 14 percent on Asia retail growth
LONDON May 21 (Reuters) - British luxury group Burberry said full-year pretax profit rose a better-than-expected 14 percent on strong retail growth in Asian markets, where it is increasing numbers of Burberry branded stores.
Burberry, known for its camel, red and black check-lined raincoats posted adjusted pretax profit of 428 million pounds ($651 million) in the year to March 31, above analyst expectations of 415 million.
Revenue in Asia Pacific, its largest region with around 35 percent of sales, rose 13 percent, led by demand for its more expensive products in China and Hong Kong.
Burberry said profit for the first half of its new fiscal year would be below last year's as focus shifts from wholesale markets - sales through non-Burberry stores - to high-growth Latin American and Asian retail sales from Burberry branded stores.
Retail sales now account for 71 percent of Burberry revenue.
First-half profit for the six months to end-September last year was 173 million pounds.
The group said it was aiming for a modest increase on the 17.1 percent adjusted operating margin achieved in the full-year, which it expected to come in the second half of the year, when it should generate more revenues than in the first.
The firm repeated that it expected first-half wholesale underlying revenue to decrease by around 10 percent as it reduces accounts in Europe and in North America. The firm is focused instead on tapping appetite for Western luxury in faster growing, higher end, Asian and Latin American retail markets.
The group will open a net 10 Burberry stores in the new year, with three larger format stores opening in Shanghai to serve local customers and Chinese domestic tourists.
Strong growth in China contrasts with more cautious recent comments on the region from fashion rivals like French group PPR , which owns fashion brands Gucci, and the owner of luxury brand Louis Vuitton, LVMH, which have both reported slower growth in China.
Revenue in Europe and the Americas rose by 6 percent respectively last year.
Shares in the FTSE 100-listed firm closed at 1463 pence on Tuesday, up 17 percent on six months ago, valuing the business at around 6.4 billion pounds.