Shares in luxury goods companies tumbled on Tuesday after Burberry reported a sharp slowdown in sales growth, stoking fears a near three-year boom for the industry might be coming to an end as China’s economic growth slows and the euro zone’s debt crisis drags on.

“We should avoid panicking because of an announcement of an individual company,” Gianluca Brozzetti told the Reuters Retail and Consumer Summit.

“They made some promises to investors and probably those promises were too aggressive. But it’s one thing to say the performance of Burberry is not meeting its objectives… and it’s another thing to say the luxury market has problems.”

While industry sales growth in China had slowed from levels around 20-25 percent at the height of the boom, Brozzetti said that pace was unsustainable, and demand remained healthy.

“People are getting richer (in China) and, as soon as they get richer, they want to have their reward by buying a luxury product. That is not changing,” he said.

Retail sales at Roberto Cavalli, owned by the family of the Florentine designer of the same name, were up 25 percent in the eight months through August, driven by new stores and including growth of 11 percent from shops open over a year, he said.

Sales were higher in all markets except Italy, which accounts for about 15-20 percent of the firm’s total business and is languishing in a deep economic recession.

“People in Italy are scared. They are not spending money. If somebody is telling you things are going well in Italy, they’re lying,” Brozzetti said.

Brozzetti, recruited by Roberto Cavalli in 2009 following stints at Gucci PPR.PA and Louis Vuitton (LVMH.PA: Quote, Profile, Research, Stock Buzz), said the company had attracted a number of suitors.

However, it wanted to strengthen the business before considering a sale or initial public offering.

The firm, whose flowing dresses and leather-fringed jeans have been worn by celebrities like actress Jennifer Lopez and model Cindy Crawford, was hit hard in 2009 by financial problems at the manufacturer of its younger-focused Just Cavalli line.

It signed a new licensing partner last year, but Brozzetti said it would take until 2013-14 to start seeing the full benefits of the relaunch.

The firm, which made net revenues of 178 million euros ($229 million) in 2011, is opening around 40 standalone stores this year, 18 of them in China and taking the total to about 170-175 by the end of 2012. It will open a similar number in 2013, Brozzetti said.

Follow Reuters Summits on Twitter @Reuters_Summits

(For other news from Reuters Retail and Consumer Summit, click here)

(Editing by Mike Nesbit)

Boeing Co won 50 percent more firm orders than its arch-rival, including a $14.7 billion bulk buy from United Continental announced not at the show but in Chicago on Thursday, helping it recover ground after falling behind last year.

EADS’ Airbus won a long-awaited new customer for the largest version of its future A350, Hong Kong’s Cathay Pacific, and on Thursday announced a raft of smaller orders.

The aerospace industry’s biggest event was, as expected, a chance for Boeing to rack up strong orders for its fuel-efficient 737 Max narrowbody, its answer to the Airbus short-haul offering, the A320neo, which stole the show in orders in 2011.

Boeing said it took firm or provisional orders for 285 MAX jets and said it now had 649 firm orders, compared with 1,454 for the A320neo which gained a year’s start as the two planemakers opted in succession to put fuel-saving engines on their most-sold jets.

Underscoring one of the key areas of growth anticipated by aerospace suppliers, United said its 150-plane order that included a purchase of 100 Boeing 737 MAX aircraft was aimed at replacing older aircraft in its fleet.

Long-awaited fleet replacements by U.S. airlines following a prolonged period of retrenchment are one of the main reasons – alongside growth in emerging markets – that aerospace executives remain confident despite the economic turbulence in Europe.

Yet with order books already full and economies beginning to feel the effects of Europe’s debt crisis, the spotlight shifted to how Airbus and Boeing will meet planned production increases to deliver all the aircraft they have sold.

“It is the end of the beginning,” said aerospace analyst Nick Cunningham of UK-based Agency Partners, adding, “You get the sense here that the best part of the order cycle is over”.

Airbus and Boeing, which battle for the bulk of a jet market estimated at $100 billion a year, have long trumpeted their resilience to a faltering global economy.

Until now, buoyant demand has bolstered their argument that airlines need to modernize their fleets in order to survive high fuel costs and that growth in Asia and the Middle East can offset weakness in the United States and Europe.

But the quietest Farnborough Airshow for years suggests the good times are coming to an end as the euro zone debt crisis drags on, banks become increasingly wary of financing long-term, costly aircraft orders and Chinese growth starts to slow.

“This is a much more quiet type of air show,” Damien Lasou, global managing director for aerospace and defense at Accenture, told Reuters.

“We are seeing a certain disconnect between the order book of the manufacturers and the real growth we are seeing in the airline market,” he said, adding more airlines could go bust and some existing orders could get delayed or cancelled.

Airbus and Boeing reported a total of $35 billion firm orders and $21 billion in provisional orders at the July 9-15 show, where business focuses on the first four days.

At last year’s comparable event in Paris they bagged $67.5 billion in firm orders and provisional ones worth $43 billion, dominated by a flood of orders for the Airbus A320neo. Since then airline profits have shrunk considerably.

“We weren’t expecting 700 orders,” said Airbus Chief Executive Fabrice Bregier. “We are in a very competitive market right now, with two companies which don’t make gifts to each other.”

Although most publicity has been on revamps of popular models such as the A320neo and 737 Max, the manufacturers need to sell a lot of their existing models in order to keep production plans intact and ensure a smooth transition.

Airbus confirmed it had set a target of selling 300 standard A320s this year and sales chief John Leahy said it was on course to achieve this.

“We have sold more than 500 A320neos since we launched the neo,” Leahy told Reuters. “We’re happy with results of the show, we weren’t looking for any great numbers,” he said, adding that more orders could come over the next few weeks.

Boeing plans to increase production across its product range by 30 percent by 2014 and expressed confidence in being able to manage the transition between the old and new 737 models.

“There is no question that deliveries are a very important part of our business going forward,” Boeing Commercial Airplanes marketing vice-president Randy Tinseth said.

“I think we have done a very good job in managing the bridge and I think maybe our competition is not doing as well.”

The airshow raised concerns over further delays to the Airbus A350 program after the company said it had encountered problems in drilling holes in the wing to fasten the skins to the structure.

But Airbus said it was not altering its schedule for its answer to the Boeing 787 Dreamliner which flew at the Farnborough Airshow. The A350 is due in service in mid-2014.

“Although EADS is not changing its A350 guidance at this point, we think investors are sensitive to any negative developments on the program, having been through similar issues on the Boeing 787 and A380,” said RBC analyst Robert Stallard.

(Additional reporting by Tim Hepher; Editing by Elaine Hardcastle, David Holmes and Tim Dobbyn)

Retailers across Europe have been struggling as spending has been hit by rising food and fuel prices, muted wages growth, worries about unemployment and government austerity measures.

Official data from Britain on Thursday underlined how any recovery in sentiment will be a hard slog, as figures showed another cut in spending last month.

“I don’t think things are going to get any worse than last year, they may get slightly better, but I don’t think they’re going to get a lot better,” Next Chief Executive Simon Wolfson told Reuters on Thursday, after his firm reported a 5 percent rise in 2011-12 profit.

Wolfson, a prominent supporter of Britain’s ruling Conservative Party who sits in the upper house of Parliament, said although falling inflation was good news for the consumer economy, its positive impact was being largely offset by unemployment and tight credit availability.

He is also concerned that any worsening in the euro zone sovereign debt crisis will feed through to the UK consumer.

February retail sales data from Britain’s Office for National Statistics (ONS) fell well short of economists’ forecasts on Thursday.

British retail sales suffered their biggest monthly fall in nine months and were revised sharply downwards for January.

British chains are hoping summer events, such as Euro 2012 soccer, the London Olympics and celebrations to mark the Queen’s Diamond Jubilee, will stimulate trade.

“I think the feel good factor will be something that gradually comes in through the year,” Kingfisher CEO Ian Cheshire told reporters after the group reported a 20 percent rise in year profit.

“The combination of Jubilee and the Olympics won’t create immediate cash opportunities but it’s an important part of getting people into a more positive frame of mind.”

Cheshire is also hopeful Wednesday’s Budget statement will boost the consumer. “Giving 3.5 billion pounds ($5.55 billion) to 24 million people is a helpful step in the right direction,” he said.

Next, Britain’s No.2 fashion retailer, said it made an underlying pretax profit of 570.3 million pounds in the year to end-Jan, near the top end of its forecast range.

It is budgeting for sales growth of 1-4 percent in 2012-13 and profit in a range of down 2 percent to up 7 percent.

“In many ways, Next’s figures are a microcosm of wider trends in the retail sector: sales through physical stores are under significant pressure while online is continuing to show good growth,” said analysts at Conlumino.

Kingfisher, Europe’s biggest home improvements retailer, made a pretax profit of 807 million pounds in the year to end-January, slightly above analysts’ average forecast, and detailed the next phase of its growth strategy.

“We aim to create a real leader in our industry and really break away from the pack,” said Cheshire.

The group which runs the market-leading B&Q chain in Britain as well as Castorama and Brico Depot stores in France and elsewhere, plans to expand in existing markets and develop a common range of products.

Many British retailers are still struggling. Furniture chain DFS posted a 31 percent drop in first-half underlying earnings on Thursday, while video games retailer Game (GMG.L: Quote, Profile, Research) on Wednesday filed a notice to appoint administrators.

Next shares, which have risen 10 percent over the last three months, were down 0.7 percent at 2,899 pence at 1119 GMT.

Kingfisher shares were up 1.3 percent at 304 pence. They have surged 23 percent over the past three months.

($1 = 0.6310 British pounds)

(Editing by Mike Nesbit and Elaine Hardcastle)

Store groups across Europe have been struggling as spending
has been hit by rising food and fuel prices, muted wages growth
and government austerity measures, and as shoppers have worried
about unemployment and the euro zone debt crisis.

But glimmers of hope are emerging, with inflation easing,
unemployment levelling off and consumer confidence picking up.
British chains are also looking ahead to summer events like the
Olympic Games in London and the Queen’s diamond jubilee.

“There is some important good news for the consumer,” Next
Chief Executive Simon Wolfson said on Thursday after Britain’s
No.2 fashion retailer posted a 5 percent rise in underlying
profit to 570.3 million pounds ($904 million) for the year ended
January, near the top end of its forecast range.

“By the third quarter, consumers should see their incomes
rising broadly in line with prices – a welcome end to deflation
in real earnings,” he said, adding the pressure on clothing
retailers’ costs from higher cotton prices was also easing.

However, Wolfson said he remained cautious, as much of the
good news would be offset by persistently high unemployment and
difficulty in gaining credit for consumers and businesses alike.

Kingfisher, Europe’s biggest home improvements retailer, was
also cautious about the short-term economic outlook, but was
confident of coping, thanks in part to its drive to boost profit
margins by buying more goods centrally, and directly, from cheap
manufacturing countries like China.

That drive helped the group, which runs the market-leading
B&Q chain in Britain as well as Castorama and Brico Depot stores
in France and elsewhere, to deliver a 20 percent rise in
underlying profit to 807 million pounds for the year ended
January, slightly above analysts’ average forecast.

FINDING GROWTH

Both Next and Kingfisher have coped in tough markets by
focusing on stronger performing parts of their businesses.

For Next that has been its home shopping Directory business
which had benefited from the wider trend towards shopping over
the internet and saw an 18 percent rise in profit compared with
a small decline at the group’s shops.

Kingfisher, meanwhile, has been taking business from
building trade suppliers and benefiting from stronger growing
foreign markets like France, Turkey and Russia.

British retailers that have not found such niches continue
to find life much tougher.

Furniture chain DFS posted a 31 percent drop in first-half
underlying earnings on Thursday, while video games retailer Game
Group on Wednesday filed a notice to appoint
administrators.

Official UK retail sales figures for February at 0930 GMT
are expected to show a 0.4 percent fall month-on-month following
a strong January, for a 2.5 percent rise year-on-year.

Next shares, which have risen 10 percent over the last three
months, were down 1.6 percent at 2,869 pence in early trading.

“We think a lot of the good news is already priced into the
stock,” said Seymour Pierce analysts, cutting their
recommendation to “hold” from “buy”.

Kingfisher shares were off 1.3 percent at 296 pence. They
have surged 23 percent over the past three months.

The owner of catalogue-based Argos stores and the Homebase
do-it-yourself chain said on Thursday there were reasons to be
more optimistic about the retail outlook for the coming year,
with inflation falling and events such as the Olympic Games in
London and the Queen’s diamond jubilee likely to boost spending.

However, it said it was planning cautiously after a big drop
in sales at both Argos and Homebase in the 8 weeks to Feb. 25.

“What we totally agree with is the increase in the personal
allowance,” chief executive Terry Duddy told reporters,
referring to proposals by Britain’s coalition government to
raise the threshold at which people start paying income tax.

“We think that’s an important factor and would lead to an
easing for the circumstances that people have got where they’ve
just seen disposable income falling.”

Britain’s retailers are mostly struggling as disposable
incomes have been squeezed by rising prices, muted wages growth
and austerity measures, and shoppers fret about rising
unemployment, a shaky housing market and the euro debt crisis.

Argos has been particularly hard hit because its mainly
low-income customers have suffered most and because it also
faces stiff competition from grocers, specialists and the
internet.

Sales at Argos stores open over a year dropped 8.5 percent
in the eight weeks to Feb. 25, broadly in line with a drop of
8.9 percent over the 52 weeks ending on the same date.

Duddy said shoppers were particularly cutting back spending
on electrical goods like televisions and video games, with sales
of the latter down 35 percent in the eight-week period.

Like-for-like sales at Homebase, Britain’s No.2 home
improvements retailer behind Kingfisher’s B&Q, slumped
6.5 percent in the quarter, worse than the full-year decline of
2 percent as sales of furniture, kitchens and bathrooms
suffered.

The firm said it was on track to meet analysts’ expectations
for a full-year underlying profit of around 100 million pounds,
which would be down sharply from 254 million the year before.

Finance Director Richard Ashton said it was reasonable to
expect another, albeit more modest, decline in the current
financial year, noting that analysts’ average forecast was for
an underlying profit of around 80 million pounds.

CLOSING STORES

“There are people who’ve said they could get to some
cautious optimism in the second half,” Duddy said, referring to
falling inflation and events like the Olympics and jubilee.

“We wouldn’t disagree with them, but from our point of view
we’d be better with a cautious plan rather than banking to
upsides that may or may not occur,” he added.

Espirito Santo analysts said it was good news Home Retail
had avoided another profit warning, but saw little scope of a
quick recovery.

“Trading remains tough and there is a long way to go before
we begin to see margins recover at Argos, in our view,” they
wrote in a research note.

Home Retail shares, which have lost nearly half of their
value over the last year, were down 0.7 percent to 114.2 pence
by 0850 GMT, lagging a flat European retail sector.

American John Walden started as Argos’s new managing
director last month and has been given a free rein to examine
all options for the struggling business, including closing some
of its 748 shops.

Home Retail said it shut a net 11 stores in the fourth
quarter as leases came up for renewal.

Duddy said 35 stores were coming to the end of their leases
this financial year, and a total of 185 over the next five
years. However, while the group was likely to close some of
these, he stressed that it would retain many of them and was not
going to embark on a rapid closure programme, that would be
costly if leases were ended early.

Home Retail warned in January it would cut its full-year
dividend for the first time since it listed in
2006.

Chief Executive Andy Clarke said he was instinctively
optimistic about prospects in 2012 but said it was too early to
say if positive recent data on the UK economy represented a
turning point or was merely a blip.

“Listening to customers they are still finding the prospects
of the economy quite challenging,” he told reporters on Tuesday.

Britain’s second-biggest supermarket chain behind Tesco Plc
said sales at stores open more than a year, excluding
fuel and VAT sales tax, rose 1 percent in the 14 weeks to Jan.
7.

That followed a 1.3 percent increase in the third quarter,
but compared favourably with many of its rivals, prompting CEO
Clarke to tell reporters: “We were the clear winners at
Christmas, we won Christmas.”

Asda said underlying sales rose just 0.1 percent in the last
three months of 2011, followed by a surge in demand in the first
week of January, when British shops traditionally offer unsold
stock at cheaper prices.

Tesco reported a 2.3 percent drop in underlying UK sales for
the six weeks to Jan. 7, while industry No.3 J Sainsbury
posted a 1.2 percent increase for the 14 weeks to Jan.
7 and No.4 Wm Morrison a 0.7 percent rise for the six
weeks to Jan. 1.

CUTTING BACK

Many Britons have been cutting back spending over the past
year as price increases outpaced wage rises and higher
unemployment weighed on confidence. The lack of consumption has
been one of the main drags on economic growth.

However, on Friday official data showed British retail sales
rose unexpectedly in January.

That data, a string of strong business surveys and some
stabilisation in the labour market have raised hopes that
Britain’s economy will avoid recession despite having contracted
in the last three months of 2011.

Clarke said he expected trade to benefit from this summer
from celebrations to mark the Queen’s Diamond Jubilee, the Euro
2012 soccer championships and the London Olympics.

“We would like to recognise that when we have events our
customers shop with us because the extra personality that Asda
offers brings people in,” he said.

The chain, which trades from around 540 stores, lagged
Britain’s grocery market in 2010 but fought back in 2011, helped
by its purchase of smaller format Netto stores and a re-launch
of its own-brand food range.

It has also benefited from its “price guarantee” which
offers to refund customers the difference, via a voucher, if an
online price comparison website does not show their shopping was
at least 10 percent cheaper than at a rival.

“After some difficulties last year, Asda now seems to be
successfully straddling the quality-price equation and will, in
our view, be one of the major beneficiaries from Tesco’s current
difficulties,” said analysts at retail research agency
Conlumino.

The firm said last month it would invest over 500 million
pounds ($793 million) this year, opening 25 new stores and three
depots and creating up to 5,000 jobs.

Separately Wal-Mart, the world’s biggest retailer, posted
fourth quarter sales and profit that fell short of Wall Street
expectations.

The two banks are providing Walker with a 250-million pound loan, people close to the matter said. That made his offer more valuable and edged out bids from Bain and BC Partners.

Chief executive Walker — who founded the company in 1970 — owns 23 percent of the frozen food retailer along with other managers, and has entered six weeks of exclusive talks to buy the remaining 77 percent from the two banks.

“The reality is that Malcolm Walker could increase his price, and had less conditions attached to his offer than the private equity firms,” one of the sources said.

Bain and BC Partners declined to comment.

Walker aims to finalize his financing package over the next few weeks, the person said, and hopes to gain more favorable terms from banks that were expecting to back the losing bids.

Though nothing has been decided, lenders in contention for the debt deal include UBS (UBSN.VX: Quote, Profile, Research), Bank of America Merrill Lynch (BAC.N: Quote, Profile, Research), Deutsche (DBKGn.DE: Quote, Profile, Research), Nomura (9716.T: Quote, Profile, Research) and Societe Generale, banking sources said.

Blackstone GSO, the credit arm of Blackstone Group (BX.N: Quote, Profile, Research), is likely to provide mezzanine debt if this is in the final structure, the sources said.

Mezzanine is a more expensive form of financing on offer from specialist lenders.

Iceland, in a statement on Thursday, confirmed the grocer’s management had signed an agreement with the sellers, which gives the chance to buy the company ahead of other possible bids.

Bain and BC Partners placed bids for the frozen food retailer this month, leaving Walker 42 days to match the highest bid under a shareholder agreement.

They were the final two external bidders in an auction that began last year and was hampered by competition issues which deterred interest from supermarket groups Wm Morrison (MRW.L: Quote, Profile, Research) and Walmart’s (WMT.N: Quote, Profile, Research) Asda.

The Icelandic owners rejected a 1-billion pound bid by Walker in 2010 for their stakes.

UBS and Bank of America Merrill Lynch advised the Icelandic banks. Rothschild worked for Malcolm Walker.

Landsbanki in an e-mailed statement, said it and Glitnir had signed a deal with firms owned by the leadership of Iceland Foods, including Walker.

“It is expected that a formal sale agreement will be signed shortly and the banks will issue statements regarding the process,” Landsbanki said.

($1 = 0.6372 British pounds)

(Additional reporting by Stephen Mangan and Claire Ruckin in London and Omar Valdimarsson in Reykjavik,; Editing by Muralikumar Anantharaman, Hans-Juergen Peters and David Hulmes)

The two banks are providing Walker with a 250-million pound loan, people close to the matter said. That made his offer more valuable and edged out bids from Bain and BC Partners.

Chief executive Walker — who founded the company in 1970 — owns 23 percent of the frozen food retailer along with other managers, and has entered six weeks of exclusive talks to buy the remaining 77 percent from the two banks.

“The reality is that Malcolm Walker could increase his price, and had less conditions attached to his offer than the private equity firms,” one of the sources said.

Bain and BC Partners declined to comment.

Walker aims to finalise his financing package over the next few weeks, the person said, and hopes to gain more favourable terms from banks that were expecting to back the losing bids.

Though nothing has been decided, lenders in contention for the debt deal include UBS, Bank of America Merrill Lynch, Deutsche, Nomura and Societe Generale, banking sources said.

Blackstone GSO, the credit arm of Blackstone Group, is likely to provide mezzanine debt if this is in the final structure, the sources said.

Mezzanine is a more expensive form of financing on offer from specialist lenders.

Iceland, in a statement on Thursday, confirmed the grocer’s management had signed an agreement with the sellers, which gives the chance to buy the company ahead of other possible bids.

Bain and BC Partners placed bids for the frozen food retailer this month, leaving Walker 42 days to match the highest bid under a shareholder agreement.

They were the final two external bidders in an auction that began last year and was hampered by competition issues which deterred interest from supermarket groups Wm Morrison and Walmart’s Asda.

The Icelandic owners rejected a 1-billion pound bid by Walker in 2010 for their stakes.

UBS and Bank of America Merrill Lynch advised the Icelandic banks. Rothschild worked for Malcolm Walker.

Landsbanki in an e-mailed statement, said it and Glitnir had signed a deal with firms owned by the leadership of Iceland Foods, including Walker.

“It is expected that a formal sale agreement will be signed shortly and the banks will issue statements regarding the process,” Landsbanki said.

(Additional reporting by Stephen Mangan and Claire Ruckin in London and Omar Valdimarsson in Reykjavik; Editing by Muralikumar Anantharaman, Hans-Juergen Peters and David Hulmes)

The two banks are providing Walker with a 250-million pound
loan, people close to the matter said. That made his offer more
valuable and edged out bids from Bain and BC Partners.

Chief executive Walker — who founded the company in 1970 –
owns 23 percent of the frozen food retailer along with other
managers, and has entered six weeks of exclusive talks to buy
the remaining 77 percent from the two banks.

“The reality is that Malcolm Walker could increase his
price, and had less conditions attached to his offer than the
private equity firms,” one of the sources said.

Bain and BC Partners declined to comment.

Walker aims to finalise his financing package over the next
few weeks, the person said, and hopes to gain more favourable
terms from banks that were expecting to back the losing bids.

Though nothing has been decided, lenders in contention for
the debt deal include UBS, Bank of America Merrill
Lynch, Deutsche, Nomura and Societe
Generale, banking sources said.

Blackstone GSO, the credit arm of Blackstone Group,
is likely to provide mezzanine debt if this is in the final
structure, the sources said.

Mezzanine is a more expensive form of financing on offer
from specialist lenders.

Iceland, in a statement on Thursday, confirmed the grocer’s
management had signed an agreement with the sellers, which gives
the chance to buy the company ahead of other possible bids.

Bain and BC Partners placed bids for the frozen food
retailer this month, leaving Walker 42 days to match the highest
bid under a shareholder agreement.

They were the final two external bidders in an auction that
began last year and was hampered by competition issues which
deterred interest from supermarket groups Wm Morrison
and Walmart’s Asda.

The Icelandic owners rejected a 1-billion pound bid by
Walker in 2010 for their stakes.

UBS and Bank of America Merrill Lynch advised the Icelandic
banks. Rothschild worked for Malcolm Walker.

Landsbanki in an e-mailed statement, said it and Glitnir had
signed a deal with firms owned by the leadership of Iceland
Foods, including Walker.

“It is expected that a formal sale agreement will be signed
shortly and the banks will issue statements regarding the
process,” Landsbanki said.

The 156-year-old seller of raincoats and leather goods, known for its camel, red and black check pattern, said on Tuesday it wanted to focus on more profitable full-price sales and was seeing no overall moderation in demand.

The group met forecasts with a 22 percent rise in third-quarter revenue. Some analysts said the figures were flattered by a pulling forward of wholesale orders and that the firm’s full-year guidance implied little growth in fourth-quarter wholesale sales.

“Nothing wrong with the overall numbers, however the poor performance in the U.S. and the weak 4Q guidance may worry the market,” Liberum analysts said in a research note.

At 0915 GMT, Burberry shares were down 1.9 percent at 1,275 pence, the biggest fall at that time by a European blue chip stock.

Luxury goods shares have wobbled in recent months amid signs of a slowdown in economic growth in China, the engine of recent strong demand for high-end goods, and fears the euro zone debt crisis could drag the world back into recession.

Jeweler Tiffany (TIF.N: Quote, Profile, Research, Stock Buzz) and watchmaker Swatch (UHR.VX: Quote, Profile, Research, Stock Buzz) last week warned of slower growth.

However, Swiss luxury group Richemont (CFR.VX: Quote, Profile, Research, Stock Buzz) on Monday said its third-quarter sales held up well.

Burberry’s shares, which rocketed around 10 times in value from November 2008 to July 2011, are trading well below their peak of 1,610 pence, but also clear of their October low of 1,034 pence.

ASIANS AND TOURISTS

Burberry said it made 574 million pounds ($880 million) of revenue in the three months to December 31, just above analysts’ average forecast of 569 million in a Reuters poll.

Finance chief Stacey Cartwright said the slowdown in growth from 29 percent in the first half was due to tougher comparable figures the year before and demand from Asian shoppers and tourists in particular remained strong.

Sales in the Asia-Pacific region jumped 39 percent to 210 million pounds, accounting for the largest proportion of the total, while strong demand from travelers drove sales in major cities such as London, Paris and Hong Kong.

Sales growth in the Americas, however, slowed to 4 percent from 20 percent in the first half.

Cartwright said this was due to the group’s decision to cut back sales to the discount outlets of department stores and focus on more profitable full-price sales. Demand in Burberry’s own stores in the Americas remained strong, she added.

Sales at retail outlets open over a year climbed 13 percent for the group as a whole, just ahead of a forecast 12 percent increase, though down from 16 percent in the first half.

Burberry said it was pressing ahead with its expansion plans while remaining mindful of the difficult economic backdrop.

It expects retail selling space to rise 13-14 percent in the second half, down from around 15 percent previously, due in part to the closure of some concessions in Spain.

Cartwright said southern European shoppers were showing more strain from the euro zone debt crisis than those in the north.

Burberry remained comfortable with analysts full-year consensus forecast for underlying profits to grow by about a quarter to 375 million pounds, she added.

The group said wholesale revenues rose 15 percent at constant currencies, helped by a rephasing of deliveries to the third quarter from the fourth. It expects wholesale revenues for the second-half to rise by a mid-single digit percentage.

($1 = 0.6524 pound)

(Editing by Dan Lalor and Hans-Juergen Peters)