British luxury brand Burberry continues to point to a ''more difficult external environment'' as it posts a 12 percent fall in half-year adjusted pre-tax profit. As Joel Flynn reports, it hopes the son of a famous soccer player can help it deal with any rainy days.
When it comes to high-end fashion, Burberry is as British as they come. Its chequered raincoats synonymous with London landscapes - and British celebrity as well - 12-year-old Romeo Beckham, son of soccer star David and designer Victoria, taking centre stage in this year's Christmas adverts. But while its reputation might be keeping the 158-year-old company warm, the fiscal climate, it says, is pretty chilly. Posting a 12 percent fall in half-year adjusted pre-tax profit, Burberry has pointed towards a "more difficult external environment." IG's Alastair McCaig. SOUNDBITE: IG Market Analyst, Alastair McCaig, saying (English): "I guess clothing retailers have struggled, and when you see Next posting a profit warning, you've got to assume that the rest of them are going to struggle a little bit. Burberry obviously bit more towards the premium end of the range, they've got greater exposure to Asia as well. I think the fact that Christopher Bailey's taken over has been a very smooth transition." Burberry posted 152 million pounds in profit in the six months to Sept. 30 - broadly in line with market expectations. There are concerns though about the impact of foreign exchange rates, which shaved off 75 million pounds in revenue. The company says that should become less of a factor in months to come. But for all Burberry's British branding, its emerging markets where there's concerns. SOUNDBITE: IG Market Analyst, Alastair McCaig, saying (English): "I think where the markets are a little bit worried is that they've benefitted more than most over the booming Asian markets, and with that just beginning to cool off somewhat, it will be interesting to see how long they can maintain those impressive historical figures." This is the first Christmas for new chief executive Christopher Bailey, also now chief creative officer. He'll be hoping the coming winter doesn't put them out in the cold.