Funky shoes and raincoats help Burberry weather storm

By Mark Potter

LONDON (Reuters) - Luxury goods group Burberry (BRBY.L) says its sales are holding up well in increasingly tough trading conditions, helped by demand for funky shoe styles and variations of its classic trench coat.

The firm, best known for its camel, red and black check, beat forecasts on Tuesday with a 26 percent rise in first-quarter revenues.

But the out performance was due mainly to early shipments of Autumn/Winter ranges in its wholesale business, which the group said would even out in the months ahead.

Burberry, which began in 1856 and made its name equipping polar explorers, said sales at shops open at least a year rose 4.5 percent in the three months to June 30.

That was down from 6 percent in the fourth quarter, but Chief Financial Officer Stacey Cartwright said that excluding another weak performance from its Spanish business, first-quarter growth held at around the same level.

"Retail sales patterns remain volatile on a weekly basis, but we benefited from our geographic diversity," she told reporters on a conference call, adding sales were driven by demand from the United States, France, Germany and South Korea.

Burberry shares have lost around a fifth in value over the past month on fears a slowdown in consumer spending will hit sales, although luxury goods groups believe their wealthy customers are more immune to a downturn than others.

The British Retail Consortium underscored that trading in Britain remains tough, reporting a 0.4 percent annual fall in the value of like-for-like retail sales in June.