Burberry's UK store sales fell in the fourth quarter of 2017 as the strengthening pound prompted lower tourist spending on British luxury goods.
The fashion and accessories retailer, famed for its distinct tartan, said sales in Europe declined by a "low single-digit percentage, impacted by strong UK comparatives".
UK sales fall
It added that the UK declined by a "high single digit percentage" as growth in the prior year had been boosted by tourist inflows.
Indeed, the pound was about 12% weaker versus the dollar during the same quarter in 2016 helping tourists' spending money in the UK go further than it did twelve months later.
Group sales up
In the three months to 31 December, however, comparable – or like-for-like – group store sales were up 2%.
For its full year, Burberry said guidance for operating profit remained unchanged and it expected to "remain strongly cash generative".
Marco Gobbetti, chief executive officer, said: "We are making good progress embedding our strategic vision into the organisation and remain on track to meet our full year profit target.
We are building on strong foundations and are fully focussed on the successful delivery of our multi-year plan to position Burberry firmly in luxury and deliver long-term sustainable value."
Shares in Burberry reacted badly to the update, and by mid-morning on the London Stock Exchange they were 7.9% lower at £16.44.