Burberry credit the rise of the smart man for profit increase
As Burberry's profits rise 24 per cent, chief executive Angela Ahrendts points to men's growing interest in high fashion and looking smart as the reason.
Men are becoming more interested in high fashion and looking smart in the economic downturn, according to the boss of Burberry, which reported a strong increase in sales and profits.
Angela Ahrendts, the chief executive, said menswear, and male accessories in particular, had been a highlight.
"In this economic environment, men want to look better, they want to look sharper," she said.
Tailoring and enhanced ranges drove a 26 per cent rise in menswear sales, while sales of non-clothing such as bags, small leather goods and accessories increased 50 per cent. Men have been particularly keen on iPad cases.
The company plans to open its first menswear only store in London, as part of its drive to increase its presence in the world's 25 biggest cities for luxury goods, all of them with a high number of well-paid workers, tourists and heavy population densities.
Ms Ahrendts said: "Sixty to seventy per cent of all the luxury goods sold around the world take place in just 25 cities. Burberry has been underpenetrated in these flagship markets."
The luxury goods brand was reporting a 24 per cent increase in sales to £1.86bn, and 24 per cent increase in pre-tax profits to £366m.
Though the figures were exactly in line with City expectations, the shares fell slightly after some analysts questioned whether the company could continue to increase its profit margins as fast as previously.
Many experts have expressed fear that the luxury goods sector, which has enjoyed almost complete immunity from the economic downturn, could soon be hit, especially if China's economy starts to falter and the eurozone turmoil is not resolved.
Last month Aquascutum, the 160-year-old British luxury coat maker, collapsed into administration, and was bought by Hong Kong group YGM Trading for an undisclosed sum.
Ms Ahrendts said that she had no concerns about China. "There are 30 cities in China that are as big as London. Yes you have lots of high net worth individuals in China, but you also have a huge, huge middle class, which is predicted to grow sevenfold in the next three to four years."
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