Shares in British luxury goods maker Burberry have tumbled after it cut its annual profit guidance, hit by foreign exchange volatility and subdued demand in Hong Kong and the United States.
The 159 year-old firm said 2015/16 profit for retail and wholesale - which makes up the vast majority of its business - would be £40m lower than expected.
It came after Burberry reported a rise in group profit for the year to the end of March - but adverse currency movements due to a strong pound took a big bite out of the earnings, which were also pressured by a fall in spending from customers in Hong Kong.
The company said trading in Hong Kong - which accounts for a tenth of group sales - remained challenging, while the United States was also proving "a little softer" compared to last year.
The Americas contribute a quarter of revenue.
"At this early stage of the year, we are seeing increased uncertainty in some markets," said Christopher Bailey, Burberry's chief creative officer who was made chief executive last year and now holds both roles.
Shares in the company, known for its raincoats with camel, red and black-check patterned linings, were down around 5% making it the biggest faller on the FTSE index.
"Today's news provides little if any reassurance," said Keith Bowman, analyst at Hargreaves Lansdown.
"The outlook for the group's important Chinese consumer appears to remain finely balanced, whilst currency movements continue to offer significant headwinds," he added.
Stripping out currency fluctuations, Burberry reported an 11% rise in underlying revenue to £2.5bn pounds and a 7% rise in underlying pre-tax profit to £456m for the year to the end of March.
However currency fluctuations wiped £72m from the revenue figure and £38m from profit.
Sterling hit a seven-year high against a trade-weighted basket of currencies earlier this month.
"With about 40% of our revenues in US dollar related currencies, we are exposed to movements in exchange rates from a translation impact," Chief Financial Officer Carol Fairweather told reporters.
"The underlying health of the business remains very strong. It's simply the impact of translation that we can't hedge against," she added.
Burberry said the focus on its British-made trench coats and cashmere scarves had a been a principle driver of this year's growth, as well as its investment in digital which outperformed across all its regions.
It raised its full-year dividend by 10% to 35.2 pence per share.
Burberry maintained its April guidance on plans to adjust prices in some markets in response to currency fluctuations, following similar moves by several luxury brands including Chanel, Richemont and Cartier.