Burton to expand store in Nike deal

Burton, the clothing retailer, has struck an agreement with Nike, the American sportswear group, to expand space in its flagship Oxford Circus store in London, already Europe's largest fashion store, by a quarter.

The revamp, which will take two years, will give Nike space on four floors and will be modelled on Nike's successful NikeTown concept in Chicago and New York. John Hoerner, chief executive of Burton, said: "This will become a major tourist attraction in its own right, drawing even more people into our Top Shop and Top Man stores. The NikeTown in Chicago has 1 million visitors a year."

The news came as Burton reported its six-month results to 1 March. Pre- tax profits rose 23 per cent to pounds 116m on headline sales up 11.3 per cent to pounds 1.2bn. However, news that underlying sales had risen by just 6.8 per cent lopped 6 per cent off the group's share price, which closed at 145p. Burton's home shopping businesses bought last year contributed sales of pounds 39.9m.

In a plan he called Graft-On, Mr Hoerner said he intended cross-selling products from the new mail order businesses, including clothing catalogues Racing Green and Hawkshead, through the high street retail stores, which include Burton Menswear and Dorothy Perkins, while using the group's large sourcing capacity to improve the mail order side.

"I am thinking a lot more freely about the potential of our brands. I don't want to get hung up by the organisational structure we inherited."

Mr Hoerner also said that he wanted to extend Burton's one-stop shop concept to sell menswear to encourage men to shop more. Menswear profits slumped by 38 per cent to pounds 3.8m on underlying sales down 2.4 per cent.