Burberry targets Japanese growth after profits jump

Luxury fashion group Burberry reported a jump in annual profits on Wednesday, as new head Christopher Bailey said expansion in Japan would help the company build on record sales. Profit after tax rallied 27 percent to £322.5 million ($543 million, 396 million euros) in the 12 months to the end of March, compared with performance in 2012/13, the British company said in an earnings statement. Revenue increased 17 percent to £2.33 billion, while adjusted pre-tax profit grew 8.0 percent to £461 million. “Burberry delivered record sales and profit in 2013/14," the group's new chief executive Christopher Bailey said in the statement. Bailey said Burberry was focused on expansion in Japan and pushing ahead with its cosmetics, or Beauty division. "As we enter a new chapter, our teams are united and energised by the opportunities ahead -- from unlocking Japan, to accelerating Beauty." He added: "While mindful of macroeconomic uncertainties and currency headwinds, we remain focused on the things we can control and confident of driving sustainable future growth, benefiting all our stakeholders." Burberry said it was in the process of building brand presence in Japan, the world's second largest luxury market globally, while growing its retail operations in Tokyo and Osaka. The group's share price rose 1.19 percent to stand at 1,534 pence in reaction to the earnings update. London's benchmark FTSE 100 index edged up 0.03 percent to 6,803.79 points in early deals. “It appears that the newly appointed CEO has inherited a company which is in fine fettle," said Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers. "Less positively, Burberry highlighted that currency headwinds could have a material impact on profits next year, the dividend yield remains anaemic despite the hike announced and the retail sector remains under extreme pressure, as evidenced by some recent updates from competitors." Bailey, who is also Burberry's chief creative officer, officially took over from the company's previous long-serving head Angela Ahrendts earlier this month. Ahrendts departed after eight years at the helm to become head of retail at Apple. London-listed Burberry, famous for its trademark red, camel and black check design on luxury clothes and handbags, underwent huge expansion into emerging markets under Bailey's predecessor.