Burberry impresses investors with return to growth in China

Burberry was back in fashion with the City on Thursday as investors welcomed the British designer’s return to growth in mainland China despite the country’s economic turmoil.

Growth of 1% in the three months to December 31 calmed fears that China’s volatile markets had hit sales.

In October, Burberry warned that full-year profits will be lower than last year.

Shares in the company, famed for its trademark trenchcoats, rose 26p to 1138p, making it one of the top risers on the FTSE 100 index.

However, Burberry, led by its former design chief Christopher Bailey, said sales slumped by more than 20% in Hong Kong where weak footfall continued to bite.

The UK also “became more challenging” owing to unseasonably warm weather affecting sales, and fewer tourists visiting from the Middle East and China.

Bailey said it was “a tougher environment than expected”. Retail revenue rose 1% to £603 million.

Elsewhere in the luxury sector, Cartier’s parent Richemont posted a 4% sales drop.