Burberry plans a big expansion into the luxury shoe market after defying the doom and gloom on the high street to post a 14 per cent jump in annual pre-tax profits.

The fashion group, best known for its trademark trench coats, wants to generate more than £100 million a year from the sale of top of the range shoes in five years’ time as part of a wider push into accessories - a near ten-fold increase.

Burberry’s fastest-selling products over the past year have been luxury handbags, including the £13,000 Warrior, and nearly a third of the group’s total sales are generated outside clothing. It recently launched a jewellery line and is testing luxury luggage later this year.

Angela Ahrendts, chief executive, said the plans reflected the growing “brand momentum” across the business, despite more challenging trading conditions.

Annual results published today showed pre-tax profits rose 14 per cent to £206.2 million in the year to March 31 at constant exchange rates. Total sales rose 18 per cent to £995.4 million.

Like-for-like sales during the year were 8 per cent higher than the previous 12 months.

Burberry reiterated that capital expenditure would almost double to £95 million this year, while it also plans to take net debt up to £100 million, almost double the level in 2007.

However, the group stuck to targets for the 2008-2009 financial year. Ms Ahrendts said: “Burberry’s 18 per cent revenue growth and 14 per cent profit increase demonstrate the robustness of our global luxury business in these challenging times.

“Brand momentum remains strong and we are investing for the future, continuing to grow and innovate our iconic outwear, while developing exciting new businesses such as shoes, jewellery and childrenswear.”

Burberry is the latest luxury group to prove resilient to the global credit crunch. Last week Richemont, the Swiss luxury goods maker behind Cartier watches and Piaget jewellery, reported an 18 per cent rise in full-year profits.

Luxury brands have been bolstered by strong growth in Asia and emerging markets such as Russia, while their customers in the US are largely immune to the squeeze on incomes caused by higher petrol prices and mortgage bills.

Burberry said revenues in the US and Europe were 26 per cent ahead of the previous year. The group will open between eight and ten stores in North America this year.

Wholesale revenue from emerging markets, including China, the Middle East and Russia, rose 50 per cent.

Shareholders will receive a full-year dividend of 12p per cent, up 14 per cent.

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