The luxury goods company said retail revenues rose to 407 million pounds ($637 million) in the three months ending June 30, driven by strong sales of British-made heritage trench coats and cashmere scarves. The figure represents an 8 per cent increase in "underlying" sales, down from 17 per cent in the same period last year.
Sales in Asia declined, hurt by the "challenging environment in Hong Kong," the company said. Mainland China posted "low single-digit" growth.
"A number of factors, such as a stuttering economy and Chinese President Xi Jinping's crackdown on gift-giving corruption, have undermined consumer demand for luxury goods in the country," said Andrew Hall of Conlumino, a retail consultant and researcher. "This changing consumer demand has led to a faltering of sales for Burberry, particularly in Hong Kong, where the sales decline reached double digits."
In the Americas, Burberry said it delivered "high single-digit percentage comparable growth."
The results will put pressure on CEO Christopher Bailey as he prepares for Thursday's shareholders meeting.
Bailey has expanded the British heritage brand's digital profile, pioneering live streaming of shows and selling directly from the catwalk. His personalized ponchos — monogrammed with a customer's initials — enthralled the fashion press.
But shareholders are asking whether he is worth the 7.9 million pounds ($12.3 million) he received last year. Bailey faced a near-revolt last year when shareholders questioned his compensation, which included 1 million shares awarded when he was approached by another employer and 500,000 when he became CEO.
Pensions & Investments Research Consultants, an independent corporate governance consultancy, has urged shareholders to vote against Burberry's remuneration report this year. PIRC says the CEO's pay and bonuses were "excessive" and his recruitment awards "inappropriate."