Burberry's UK Performance Boosted by Sterling Slump -- Update

(Adds detail on CEO change, fall in sterling)

By Simon Zekaria

LONDON--Burberry Group PLC (BURBY) reported Wednesday a better-than-expected rise in quarterly revenue, boosted by purchases in the U.K. and in Asia, ahead of the British luxury retailer's new chief executive joining next week.

The slump in the pound since the U.K. voted to exit the European Union in June saw bargain-hunting tourists flock to the U.K. in the run-up to Christmas to snap up Burberry goods. The company, which is famous for its checked designs and trench coats, said its U.K. performance in the fiscal third quarter was exceptional, with comparable sales surging around 40% on the same period in 2015.

Demand in the U.K. came from tourists travelling from all regions, including the U.S., Europe and China, as well as domestic customers, according to investor relations director, Charlotte Cowley.

She declined to comment on the U.K.'s commitment to leaving the EU's single market, saying it was too early to make a judgement.

Revenue in the three months to Dec. 31 rose 4% on an adjusted basis to 735 million pounds ($896 million). Comparable sales rose 3%, beating analyst forecasts.

The company said its pretax profit on an adjusted basis for fiscal 2017 should be in line with market expectations.

At 0923 GMT, Burberry shares were flat at 1,592 pence, valuing the company at GBP7 billion. The stock is up 6% in 2017.

On a comparable basis, the Asia-Pacific region returned to growth with a low single-digit gain, with improved performance in China and Hong Kong, Burberry said in a statement.

Trading in Europe, the Middle East, India and Africa saw double-digit percentage growth, but there was a low single-digit percentage decline in the Americas.

Chief Executive Christopher Bailey said the group had seen strong demand for new products, with overall strength in bag sales.

Mr. Bailey's successor is Marco Gobbetti, who is currently chairman and CEO of Celine, a fashion and accessories brand owned by LVMH Moet Hennessy Louis Vuitton SE. Mr. Gobbetti will join Burberry next week and will take on the full CEO role in July.

Mr. Bailey, who has weathered sharp criticism and a deep stock decline during his two years as CEO and chief creative officer of the fashion label, will remain with Burberry as creative chief and president, which is a new title.

-Olga Cotaga contributed to this article.

-Write to Simon Zekaria at [e-mail]

(END) Dow Jones Newswires

January 18, 2017 05:05 ET (10:05 GMT)

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