Shares in luxury goods maker Burberry (LON:BRBY) opened lower this morning as investors deemed the first set of full-year results from chief executive Christopher Bailey unfashionable.
Revenues climbed, profit before tax was 7% higher on an underlying basis at £456mln and there was even a 10% dividend hike for investors.
However, the positives were overshadowed by a 1.1% drop in adjusted profits, with FX costs weighing, and a cautious outlook statement.
Burberry said it now expects earnings in the 12 months through March to be around £40mln less than previously estimated due to the recent strength of the pound.
“Against this background, we will continue to manage our business dynamically - capitalising on the significant opportunities we have by channel, region and product to create long-term shareholder value," said Bailey, who replaced the Apple’s Angela Ahrendts last year.
He added that the business, known for its chequered trench coats and scarves, is seeing increased uncertainty in some markets..
In Hong Kong, the retailer saw a fall in spend from Chinese customers in the second half of the year.
The drop was offset by growth in Europe, other parts of Asia Pacific and the Americas.
“While Burberry echoes other corporates by referencing a “challenging external backdrop”, it is ‘uncertainty in certain markets at this early stage of the year’ which has spooked traders,” said Mike van Dulken at Accendo Markets.
Shares lost 83p to 1,725p, a drop of 4.5%.