* H2 revenue up 19 pct to 1.3 bln stg, as expected
* Retail revenue up 13 pct
* Sees currency headwinds hitting profits in 2014, 2015
(Adds CFO comments, share price)
By Brenda Goh
LONDON, April 16 British luxury goods group
Burberry shrugged off industry jitters about slowing
growth in China to post a 19 percent rise in second-half
revenue, reiterating that the greatest risk to its profits was
the strengthening pound.
The firm, whose largest market for its check-patterned
trenchcoats and leather goods is the Asia-Pacific, said on
Wednesday strong demand in mainland China and South Korea was
driving double-digit revenue growth in the region.
"We see great opportunity for us still in China, both at
home in China and when the Chinese luxury consumer travels
abroad," finance chief Carol Fairweather said.
Analysts have expressed concerns over whether the luxury
sector can maintain the double-digit growth it has achieved in
recent years as its main engine, China, faces an economic
slowdown and a government crackdown on conspicuous consumption.
Data on Wednesday showed China's economy grew at its slowest
pace in 18 months at the start of 2014. Burberry's comments on
the subject are closely monitored since it was one of the first
major luxury brands to warn of a slowdown in China in 2012,
sending tremors throughout the whole industry.
Fairweather said she believed the 158-year-old firm's
investment in the digital world - which has seen it promote
goods through Facebook and install iPads in its stores - was
giving Burberry an advantage over its competitors in attracting
China's younger, luxury customers.
Rival Gucci, owned by Kering, said in February its
sales growth had stalled in the fourth quarter, hit by
over-expansion in China where demand had weakened.
While repeating its January warning over the hit to 2013-14
retail and wholesale profit from the strength of sterling,
Burberry said profits for its new financial year could face a
"material" impact should exchange rates stay at current levels.
Sterling has risen about 4 percent against the U.S.
dollar over the past six months.
Citi analyst Thomas Chauvet said the warning over currency
headwinds offset what otherwise showed Burberry's "superior
revenue growth profile" that made it one of the only luxury
brands, alongside Italy's Prada, to continue enjoying
double-digit revenue growth.
Shares in Burberry, which have fallen by almost 6 percent
since the start of the year, were up 1.1 percent at 0920 GMT,
against 0.5 percent rise in the FTSE 100 index
The firm said total revenue for the six months to March 31
was 1.3 billion pounds ($2.2 billion), in line with forecasts.
Retail revenue, which accounts for 70 percent of Burberry's
sales, was up 13 percent over the second half at 928 million
pounds. Comparable store sales growth was 12 percent, driven by
double-digit percentage growth in the Asia Pacific.
Burberry is in the midst of a transition, as chief executive
Angela Ahrendts is due to depart for Apple in the
spring and will hand over the reins to chief creative director
Christopher Bailey who will take on a dual role. Fairweather
declined to specify a date for the management change.
($1 = 0.5977 British Pounds)
(Editing by Paul Sandle and Mark Potter)