Burberry pins hopes on China recovery

British luxury brand Burberry said its outlook for the year ahead depended on how quickly China, its biggest market, recovered from Covid lockdowns, after meeting expectations for sales and operating profit for its 2022 financial year ended April 2.

Sales in China, which accounted for 30 percent of the 166-year-old company's turnover last year, fell 13 percent in the last quarter, chief financial officer Julie Brown said.

Full or partial lockdowns were imposed in dozens of Chinese cities including Shanghai in March and April, keeping workers and shoppers confined to their homes and severely disrupting supply chains.

Currently, about 40 percent of Burberry's business in the country was affected by lockdown measures, according to Brown.

Burberry said its medium-term outlook depended on the impact of Covid-19 and rate of recovery in consumer spending in China.

China's track record was a good omen, Brown said. "The good news is when you look at what happened in the first wave, the recovery is very quick and very pronounced," she said.

The company's rivals have faced similar hits in China. Gucci-owner Kering said last month that lockdowns had disrupted its business in the country.

Burberry reported a 23 percent rise in revenue to 2.83 billion pounds (HK$27.58 billion), with comparable store sales in its final quarter growing 7 percent after lockdowns in mainland China weighed on its performance in March.