Burberry has reported a 5% dip in annual pre-tax profits despite a boost to revenues from the weak pound in the wake of the Brexit vote.
The luxury brand said earnings for the year to 31 March fell to £395m from £416m over the previous 12 months.
However, revenue grew 10% on a reported basis – which reflects currency movements – as retail sales growth was aided by a weaker pound, offsetting declines in its wholesale and licensing divisions.
Burberry had previously explained how its European retail operations – particularly those in Britain – were benefiting from a surge in sales among US and Chinese shoppers taking advantage of sterling’s fall in value since the EU referendum.
It said revenue derived from external customers in the UK totalled £300.9m over the 12 month period – up from £250.2m the previous year.
On an underlying basis, group revenue fell by 2%.
Burberry said: “The external environment remained challenging… particularly in the US and Hong Kong.
“For the industry, newness led growth and accessories outperformed while apparel saw softer trends.”
It said its best sellers were new handbags – with retail sales rising in the mid-teens in percentage terms.
Burberry said its efforts to focus on costs and drive digital sales were on track – with £20m in savings delivered in the last financial year and £50m expected in the current year.
Its digital shake-up has included the soft-launch of a retail app in the UK.
Christopher Bailey, Burberry’s chief creative and chief executive, said: “2017 was a year of transition for Burberry in a fast changing luxury market.
“The actions we have taken to lay the foundations for future growth are yielding early benefits and I remain confident that these will build over time.
“Marco Gobbetti assumes the role of CEO (chief executive officer) from July.
“With his extensive experience in the sector, we will build on these foundations to elevate and strengthen the brand further and take Burberry to the next level as a global luxury retail and digital business.
“I am excited to work closely with him in this next chapter.”
Bailey will remain with Burberry after the change of leadership – maintaining his creative role and also taking the title of president.
Gobbetti has been head of the French fashion house Celine.
Burberry shares – up 11% in the year to date – were the biggest risers in early trading on the FTSE 100 in the wake of the results statement, rising more than 2%.