Burberry is targeting growth in non-clothing ranges like shoes and purses in the economic recovery, the luxury goods group said yesterday, as it posted a smaller-than-forecast fall in first-half profit.

The 153-year-old group, sketching out its plans for the next three years, also said it wants to boost its presence in China and the Americas and attract younger shoppers via social media such as its recently launched artofthetrench.com website.

"While the last year or so has presented us as a management team with the most challenging conditions we've ever had to work through, we have been equally focused on how best to position Burberry for superior growth when the global economy recovers," chief executive officer Angela Ahrendts told analysts yesterday.

Burberry declined to say whether the recovery was firmly underway but said it was outperforming rivals and was confident its trademark trench coats and handbags, as well as leather goods, scarves and snoods would sell well this Christmas.

"We're very well positioned whichever way this goes," chief financial officer Stacey Cartwright told reporters, pointing to big cuts in Burberry's inventory levels and also its ability to buy in stock quickly.

"Clearly there's a momentum in the brand at the moment. We want to make sure we don't miss a sale," she said.

Luxury goods firms have been hit hard in the recession. But industry leaders LVMH, Richemont and Hermes have all recently reported signs of improving demand. Burberry, known for its camel, red and black check, has coped better than most in the downturn because it reacted quickly by slashing costs, jobs, stock and range assortments. Its recent collections have also received rave reviews.

Operating profit before one-off items fell 19 per cent at constant currencies to £86.3 million in the six months to September 30, beating analysts' average forecast of £83 million, thanks in part to cost cutting.

Ms Cartwright did not expect analysts to raise their full-year forecasts after they were lifted to about £190 million following a better-than-expected sales update in October. The half-year dividend was up four per cent to 3.5 pence a share.

Some analysts said the good news was offset by higher operating expenses as Burberry invests in its retail business and questioned whether it was running stock levels too tightly.

"Does Burberry have the supply chain to be flexible if demand picks up?," JP Morgan analysts asked.

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