Trading Statement

Burberry Group PLC
16 January 2007


                              Burberry Group plc

                    Third Quarter 2006/07 Trading Update

16 January 2007. Burberry Group plc reports on trading for the third quarter
ended 31 December 2006.

Financial Highlights

• Total revenue increased 25% on an underlying* basis, 22% reported
• Retail sales increased 24% underlying driven by existing and new stores
• Wholesale revenue increased 33% underlying, partially driven by shift in
  timing of shipments
    -  Updated second half growth expectations to low-to-mid teen underlying
       percentage increase
• Licensing revenue increased 12% underlying
    -  Currently anticipate mid-to-high single digit underlying percentage
       increase for second half

Revenue by geographical origin (statutory accounts format)

                                   Third Quarter
                               ___________________
£ million                      2006/07     2005/06
                               _______     _______
Europe (excluding Spain)            59          46
Spain                               23          15
North America                       71          60
Asia Pacific                        54          48
                               _______     _______
Total                              206         168


Revenue by channel of distribution

                          Third Quarter                                   Nine months
          __________________________________________   __________________________________________
               Reported             % change                Reported             % change
          _________________   ______________________   _________________   ______________________
£ million 2006/07   2005/06   Reported   Underlying*   2006/07   2005/06   Reported   Underlying*
          _______   _______   ________   ___________   _______   _______   ________   ___________

Retail        143       115         25            24       312       242         29            24
Wholesale      43        36         22            33       225       229         (1)            6
Licence        19        18          7            12        60        58          4             7
          _______   _______   ________   ___________   _______   _______   ________   ___________
Total         206       168         22            25       597       529         13            14

* Third quarter underlying figures exclude the financial effect of the portion
of Burberry's business in Spain affected by the retail conversion, in both
reporting periods. In addition, nine month underlying figures also include the
first half adjustment for the Taiwan acquisition. For both periods, underlying
figures are calculated at the same exchange rates used in the 2005/06 reported
results. Burberry initiated actions related to the retail conversion in Spain
during the third quarter of 2005/06.

Commenting on the trading results, Angela Ahrendts, Chief Executive Officer,
stated, 'This outstanding quarter has been led by Burberry's strong retail
performance. These results are a credit to the extended efforts of the team in
executing our core strategies, specifically in innovating outerwear,
intensifying the luxury accessory offering and implementing operational
enhancements. This performance is consistent with expectations for the financial
year.'

Total revenue

Total revenue in the third quarter ended 31 December 2006 increased 25% on an
underlying basis (i.e. adjusted for (i) the portion of Burberry's business in
Spain affected by the retail conversion and (ii) exchange rate differences). The
Spain retail conversion shifts sales from Burberry's wholesale channel to its
retail channel. In determining underlying performance, the financial effect of
the affected business is excluded from both reporting periods. Total reported
revenue increased 22%. Adverse exchange rate movements reduced the reported gain
by approximately seven percentage points.

Third Quarter Retail and Wholesale Revenue by Geographical Market (Destination)

                               Reported             % change
                         __________________   _____________________
Region                   2006/07    2005/06   Reported   Underlying
________________________ _______    _______   ________   __________
Europe (excluding Spain)      47         37         26           26
Spain                         22         14         60            8
North America                 72         61         18           30
Asia Pacific                  42         37         15           21
Other                          4          2        113          113
                         _______    _______   ________   __________
Total                        186        150         24           26



Retail

Retail sales accounted for approximately 70% of total revenue in the period.

Retail sales in the third quarter increased 24% underlying, 25% reported.
Comparable store sales increased 13% and average selling space increased
approximately 14% underlying in the quarter. The Spain retail conversion
contributed approximately eight percentage points of the reported gain. Adverse
exchange rate movements, primarily US dollar, reduced the reported gain by
approximately seven percentage points. During the quarter, Burberry opened
stores in Northern Los Angeles (California) and Vienna (Austria), five
concessions and one outlet store.

Retail performance was consistently strong across the regions. In the US,
existing stores and new store space drove strong sales gains. New space
additions and gains at existing stores and concessions resulted in excellent
sales increases in Continental European markets. The UK market continued to
achieve double-digit gains on the strength of existing space. Asia Pacific
achieved strong sales growth led by existing stores in Hong Kong, Korea and
other Southeast Asian markets.

Several factors underpinned the retail strength. In the product arena,
outstanding outerwear performance, driven by updated styles and balanced
assortments, led gains. New luxury handbag styles and Burberry's runway
collection also experienced excellent demand. In-stock positions improved as a
result of implementation of a basic replenishment programme. Increased frequency
of new product flow to stores resulted in fresher merchandise assortments
relative to the previous year period.

In the fourth quarter, Burberry plans to open stores in Manchester (UK) and
Seville (Spain), a new concept store in Prague (Czech Republic) and an outlet.
The Group expects to add approximately 14% average underlying retail selling
space for the second half and 13% for the financial year.

Wholesale

Wholesale sales accounted for approximately 21% of total revenue in the period.

In the quarter, total wholesale sales increased 33% underlying, 22% reported. A
shift in the timing of selected shipments from the first half to the third
quarter boosted gains for the current period. The third quarter of each
financial year is a small wholesale quarter with the large majority of spring/
summer merchandise shipments concentrated in the fourth quarter.

The Group anticipates a low-to-mid teen underlying percentage increase in
wholesale sales for the second half. The improved outlook reflects initial
success of the basic replenishment programme and incremental orders associated
with the new market calendar.

In conjunction with local franchise partners, the Group opened stores in Kiev
(Ukraine) and Mexico City (Mexico) during the quarter.

Licensing

Licensing revenue in the quarter increased 12% on an underlying basis, 7%
reported. In Japan, good volume gains among ongoing licences offset the effect
of licence terminations, producing a solid gain for the quarter. Excellent
growth in product licence revenue was led by fragrances, which continued to
benefit from the 2006 Burberry London fragrance launches, and strong progress in
watches. Burberry currently anticipates a mid-to-high single digit underlying
percentage increase in licensing revenue for the second half. Reported figures
will continue to be affected by adverse exchange rate movements.

Operational efficiency

The Group recently progressed two significant activities designed to enhance the
Group's long-term operating efficiency. Following a proposal made in September
2006, the Group announced the expected closure of a Welsh manufacturing facility
in March 2007. This will result in a cash cost of approximately £3.5 million to
cover an enhanced redundancy package and outplacement and training services for
affected employees, and a non-cash expense of £1.7 million associated with asset
write-offs, for a total charge of approximately £5.2 million in the current
financial year. Expense savings associated with additional manufacturing
efficiencies are expected to be approximately £1.5 million annually.

With respect to its central operations, Burberry entered into a lease for a
global headquarters. Located in central London (Westminster), the site will
allow the Group to consolidate its global operations, including design,
merchandising, marketing, supply chain, finance and executive and administrative
functions, within a single facility. These functions are currently divided among
five buildings in London. The relocation is expected to take place in late 2008.

Burberry will provide a second half trading update on 17 April.

Enquiries:

Burberry                                        020 7968 0577
Stacey Cartwright       CFO
Matt McEvoy             Strategy and IR
John Scaramuzza         Strategy and IR

Brunswick                                       020 7404 5959
Susan Gilchrist
Laura Cummings
Robert Gardener

The financial information contained in this Trading Update has not been audited.

Certain statements made in this Trading Update are forward looking statements.
Such statements are based on current expectations and are subject to a number of
risks and uncertainties that could cause actual results to differ materially
from any expected future results in forward looking statements.

This announcement does not constitute an invitation to underwrite, subscribe for
or otherwise acquire or dispose of any Burberry Group plc shares. Past
performance is not a guide to future performance and persons needing advice
should consult an independent financial adviser.



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