Burberry Group PLC (LON:BRBY)

QUOTE AND NEWS
Forbes  4 hrs ago  Comment 
The future looks bright for Burberry despite last year’s bottom-line blip. Here is why.
Financial Times  6 hrs ago  Comment 
Sales are sluggish and it may take more than new handbags to reinvigorate them
Financial Times  9 hrs ago  Comment 
UK luxury fashion group is cutting costs as it ushers in new boss
BBC News  11 hrs ago  Comment 
The British fashion brand says profits fell despite a boost to UK sales from the fall in the pound.
Financial Times  12 hrs ago  Comment 
Luxury fashion brand has been cutting number of products to make cost savings
BBC News  May 4  Comment 
The luxury brand said it plans to open a new business services centre in Leeds in October.
Financial Times  Apr 20  Comment 
Burberry and Unilever in demand as blue-chip index ends four-day losses




 
TOP CONTRIBUTORS

Burberry Group plc (London Stock Exchange :BRBY) is the UK's number one luxury retailer by revenue. The firm designs, sources, manufactures and distributes luxury mens, womens and childrenswear and non-apparel accessories globally through its own retail stores, concessions and wholesale customers. In fiscal 2010, BRBY reported net sales of £1.28 billion and net income of £81.4 million.[1]

Despite harsh economic conditions in Europe, where Burberry receives nearly half of net sales annually,[1] the firm continued to grow and prosper in fiscal 2010. The main driver for Burberry's success has been its restructuring of its global business plan, such as opening more stores in the Asia Pacific region. In addition to global restructuring, Burberry has focused on improving non-apparel (fashion accessories) sales to have a more balanced product line.

Company Overview

Business Growth

2010 Fiscal Year Performance

  • Burberry posted fiscal year revenue of £1.28 billion, a 7% increase compared to fiscal 2009.[1]
  • The firm reported net income of £81.4 million, compared to a net loss of £6 million in fiscal 2009.[1]

Business Segments

  • Retail (58% of fiscal 2010 Revenue)[1]
  • Wholesale (34%)
  • Licensing (8%)

Geographic Presence

  • Europe (44% of Revenue)
  • Americas (27%)
  • Asia Pacific (24%)
  • Rest of World (5%)

Trends and Forces

Exposure to European Macroeconomics

Burberry, based in the U.K., receives nearly 50% of annual revenues from European markets.[1] Furthermore, Burberry is a luxury retailer whose profits are sensitive to consumer confidence levels. If a Europe-specific economic crisis, such as European debt contagion, occurs, then Burberry could suffer relative to its international competitors. To obtain a more diversified geographic presence, BRBY has opened stores in the Asia Pacific region -- the fastest growing luxury retail market in the world.

Burberry Focuses on Non-Apparel Business

Burberry's apparel line, such as shirts, coats, and pants, has been the firm's core revenue producer since the firm's beginning. Although, the firm has focused on improving its non-apparel business -- items such as handbags, scarves, shoes, and jewelry.[1] The key non-apparel product is the handbag, most of which are designed with Burberry's trademark flannel print, which composes 48% of non-apparel revenue.[1] Burberry has continued to expand the non-apparel business in Tokyo -- the world's largest fashion accessories market.[1]

Competition

Burberry competes against other retailers in the estimated £150 billion luxury goods market.[1] Publicly-traded companies are listed below. BRBY also competes against privately-held luxury retailers such as Giorgio Armani, Prada and Gucci.

  • Hugo Boss The German luxury retailer produces the same product lines as BRBY and competes for European, American, and Asian market share.
  • LVMH Moet Hennessy LVMH's Fashion business, with brands such as Marc Jacobs and Louis Voitton, competes directly with Burberry's Retail business. LVMH also has profitable wine and leather goods businesses.
  • Christian Dior: Like Hugo Boss, the Paris-based Dior creates similar product lines and competes with Burberry in European, American, and Asian markets.
  • Coach The U.S. luxury retailer competes with Burberry's fashion accessories product line.

References

  1. 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 Burberry 2010 Annual Report
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