British luxury clothing and accessories maker Burberry said on Tuesday that annual net profits fell 3.4 percent after it took a large exceptional charge.
Earnings after tax slid to £254.3 million in 12 months to the end of March, compared with net earnings of £263.3 million (300 million euros, $386.0 million) in its 2011-12 financial year.
Burberry’s performance was hit by a one-off charge of £82.9 million linked to the termination of a fragrance and beauty licence deal. The group took its perfume division in-house last month.
The London-listed firm, renowned for its trademark red, camel and black check design, added that adjusted pre-tax profits before exceptional items climbed 14 percent to £428 million, boosted by Asia. That beat market expectations.
Group revenues grew eight percent to almost £2.0 billion, thanks largely to a 20-percent jump in key market China.
The company also raised its full year dividend by 16 percent to 29 pence a share.
In reaction to Tuesday’s results, Burberry shares rose 1.64 percent to 1,487 pence, bucking London’s benchmark FTSE 100 index, which fell 0.03 percent in morning deals.
Last month, the group began directly operating its perfume business following the end of a licence relationship with French company Interparfums.
“Burberry believes that beauty will be a key contributor to future growth, as the brand is under-penetrated relative to peers and direct ownership will enable opportunities to be pursued more rapidly,” it added on Tuesday.
In September 2012, Burberry had warned that its second-quarter earnings had been hit by a slowdown in China.
Burberry profits drop on exceptional charge
