The Burberry share price surged 7% on Friday morning after the group upgraded its full-year profit forecast.
Thanks to a growth in sales in China and South Korea, the luxury retailer said that like-for-like retail sales would increase by almost a third year-on-year during the first three months of 2021.
The trading update sent shares soaring 7% on Friday’s trading.
“Since December, we have continued to see a strong rebound and now expect revenue and adjusted operating profit to be ahead of consensus expectations,” said Burberry.
Commenting on the upgraded profit forecast, Russ Mould, investment director at AJ Bell, said: “Burberry has been strutting down the catwalk with quite a pose since the latter part of 2020 as its earnings recovery takes shape. Its latest update shows that trading is better than expected which is impressive given that this is likely to be just the first stage in a multi-phase bounce back.
“A lot of its business has historically come from Asian tourists taking trips across Europe. They like to spend big and its products are highly desirable. The restrictions on international travel are only in the nascent stages of being lifted and the return of tourist-related sales may not pick up in earnest until 2022,” he added.