Burberry Group (LON:BRBY) Releases Quarterly Earnings Results

Burberry Group (LON:BRBY) posted its earnings results on Thursday. The company reported GBX 3.50 EPS for the quarter, Digital Look Earnings reports. Burberry Group had a net margin of 0.87% and a return on equity of 2.29%. The firm had revenue of GBX 109.80 billion for the quarter.

Here are the key takeaways from Burberry Group’s conference call:

• First-half comparable retail sales rose 4% and revenue increased 6% to £1.1 billion. Adjusted operating profit more than tripled to £62 million from £19 million, with adjusted operating margin expanding 390 basis points to 5.7%.
• Gross margin increased 40 basis points, supported by stronger full-price sales, but also benefited from a one-off supply-chain rebate. Excluding that item, underlying gross margin was down approximately 10 basis points; Burberry expects expansion in the second half and full year.
• Wholesale revenue grew 17%, ahead of guidance, as partners reordered and expressed confidence in the brand. Outerwear grew by double digits, while growth also extended to leather goods and other product categories.
• Performance varied by region: the Americas grew 12% and Greater China 7%, while EMEIA declined 2%, reflecting weaker tourist activity and traffic, particularly in outlet stores. Management also acknowledged an uncertain luxury-market backdrop.
• Management said it expects further progress toward revenue growth and margin expansion, while remaining comfortable with the midpoint of analyst consensus. Cost discipline is expected to continue, with flat operating expenses targeted for FY 2027; the company also reported leverage improving to 1.7 times.

Burberry Group Stock Performance

Shares of Burberry Group stock traded up GBX 88.50 during trading hours on Thursday, hitting GBX 1,181.50. 248,336,031 shares of the company were exchanged, compared to its average volume of 22,100,949. The company has a current ratio of 1.87, a quick ratio of 1.63 and a debt-to-equity ratio of 162.02. The business has a 50-day moving average of GBX 1,050.87 and a 200-day moving average of GBX 1,102.47. Burberry Group has a 1 year low of GBX 953.40 and a 1 year high of GBX 1,376.50. The stock has a market capitalization of £4.23 billion, a price-to-earnings ratio of 200.25, a P/E/G ratio of 1.66 and a beta of 0.70.

Analysts Set New Price Targets

Several research firms have issued reports on BRBY. Jefferies Financial Group restated an “underperform” rating and issued a GBX 940 price objective on shares of Burberry Group in a research note on Thursday. Citigroup reduced their target price on Burberry Group from GBX 1,560 to GBX 1,510 and set a “buy” rating for the company in a report on Wednesday, August 12th. Berenberg Bank reissued a “hold” rating and issued a GBX 1,080 target price on shares of Burberry Group in a research report on Thursday, July 23rd. Finally, Royal Bank Of Canada cut Burberry Group to a “sector perform” rating and reduced their price objective for the company from GBX 1,400 to GBX 1,200 in a research note on Tuesday, September 22nd. Four analysts have rated the stock with a Buy rating, two have issued a Hold rating and two have issued a Sell rating to the company. Based on data from MarketBeat, the company currently has a consensus rating of “Hold” and a consensus price target of GBX 1,256.25.

About Burberry Group

Burberry Group plc, together with its subsidiaries, manufactures, retails, and wholesales luxury goods under the Burberry brand. The company operates in two segments, Retail/Wholesale and Licensing. It provides womenswear, menswear, childrenswear, beauty, eyewear, shoes, and accessories, as well as leather goods, such as bags. The company also licenses third parties to manufacture and distribute products using the Burberry trademarks. It sells its products through Burberry mainline stores, concessions, outlets, digital commerce, Burberry franchisees, department stores, and multi-brand specialty accounts, as well as through Burberry.com website.