British luxury brand Burberry (LON:BRBY) have had an exceptional end to 2016, with sales surging by 40 percent in the run up to Christmas.
Burberry benefitted from the drop in the value of the pound following the Brexit vote in July, which has seen tourists shop in London rather than other European cities.
The company have said the quarter had been split “50:50” with domestic consumers and tourists from Asia and the U.S. who are buying goods in the UK to take advantage of the weaker pound.
Christopher Bailey, Burberry’s chief executive and chief creative officer, said: “With a record number of views of our festive film and strong demand for new products in our collections, this third quarter improvement reflects early progress from our plans to drive Burberry’s performance for the long term. We continue to take action to position the business for growth over time and our plans to enhance efficiency are on track.”
The better-than-expected three percent rise in quarterly sales was boosted by a high demand for Burberry’s Buckle Tote bag, military jackets and knitwear ranges. Personalised wallets were also big sellers, Burberry said.
Sales for Burberry were also positive in Asia, helped by launching a collaboration with pop sensation Kris Wu, a former frontman to South Korean-Chinese supergroup EXO. Efforts to increase presence in China were also made by the launch of a local-language website in November.
George Salmon, analyst at Hargreaves Lansdown, said: “Growth has returned in the Asia-Pacific region itself, and plenty of customers are jumping on planes to the UK to take advantage of the extra buying power sterling’s weakness gives them. All in all, there are plenty of encouraging signs for the group just now.”
The company said on Wednesday that their efficiency plan, based on more simple ranges and focussing on areas of weakness like bags as well as improving customer service, was already working.
Shares in Burberry, which have increased 24 percent in the past six months helped by the weaker pound, were trading up 1.9 percent at 1,624 pence by 1130 GMT.