By Yadarisa Shabong and Helen Reid
(Reuters) -Burberry reported a 2% rise in second-quarter comparable store sales on Thursday, beating market expectations, as the British luxury brand's turnaround measures started to bear fruit and its China business showed signs of recovery.
The return to growth signals a potential turning point for the 169-year-old trench coat maker after CEO Joshua Schulman moved to refocus Burberry on outerwear and scarves, marketing an accessible vision of Britishness to global
consumers.
Schulman also cut a fifth of the workforce in a bid to streamline operations and restore profitability.
Analysts had expected comparable store sales to grow 1%, according to a company-compiled poll, after falling for seven quarters in a row.
Burberry said comparable sales in China returned to growth for the first time in more than a year, rising 3%, a sign its new marketing campaigns are stimulating demand from Chinese luxury buyers, who have cut back on spending in recent years.
"We have begun to see customers return to the brand they love," Schulman said in a statement.
Adjusted operating profit for the six months ended September 27 came in at 19 million pounds ($25.5 million), beating average market expectations of 12 million pounds. Burberry had reported a loss of 41 million pounds in the same period last year.
Burberry's shares are up 28% since the start of the year as investors have welcomed Schulman's marketing overhaul and cost cuts, and as the broader luxury sector also began to show signs of recovery.
($1 = 0.7451 pounds)
(Reporting by Yadarisa Shabong in Bengaluru; Editing by Rashmi Aich and Jan Harvey)
