Burberry, the fashion brand, shrugged off any fears that it may be vulnerable to a downturn in luxury spending by reporting a strong start to the year, helped by a doubling of wholesale sales to the Middle East and China.

The brand, which is famous for its signature-check raincoats and accessories, said yesterday that it had seen a 26 per cent rise in first-quarter revenues, despite a challenging trading environment and a double-digit fall in sales in Spain, bringing in £211 million in the three months to June 30.

Angela Ahrendts, chief executive of Burberry, said: "I am pleased with Burberry's start to the year in an increasingly challenging external environment. Our brand momentum is strong, driven by product innovation and a focused management team. This momentum, together with the diversity and balance we have across products, channels and regions, underpins our confidence for the future."

The fashion group's shares fell 2.5p in early trading to 394.5p. Burberry shares have lost around a fifth in value over the past month on fears a downturn in consumer spending will hit demand for luxury goods.

Underlying retail sales rose by 14 per cent, to £97 million, with like-for-like sales growth a respectable 4.5 per cent. Accessories, including leather coats, shoes and belts, continued to be the star performer, contributing to most of the retail growth.

The fashion group also benefited from earlier receipts for Autumn / Winter stock, underlining the increasing trend to buy early and pre-order amongst fashion devotees.

Despite the credit crunch and falling property prices, America remained the best performing region. Major cities including New York, San Francisco and Chicago showed particularly strong sales. The US oil capital, Texas, enjoying record prices of about $146 a barrel since spring, was also showing strong sales, according to Ms Ahrendts.

Sales in London, which only account for 7 per cent of total sales, were also boosted by a higher number of tourists visiting the capital. “We’ve seen a lot of Russian and Middle East travellers in our stores,” Stacey Cartwright, finance director, said.

Burberry has increased its average selling space by 12 per cent in the first quarter of the year, with a 12 to 13 per cent increase expected for the year as a whole. New stores have opened in Cannes and Budapest, as well as 14 concessions in Italy, Korea and Spain.

Burberry's wholesale business is also performing strongly with revenue expected to increase by 10 per cent year-on-year on an underlying basis, with growth in North America expected to increase by more than 20 per cent.

Wholesale sales to emerging markets doubled in the first quarter, largely reflecting earlier wholesale shipments particularly to China. Comparable stores growth in Burberry's franchise stores was very strong in the Middle East and Russia and a new store opened in Baku, Azerbaijan.

Times Recommends

• C&G axed - 1,660 jobs to be lost
• UK house prices rise 1.1% as buyers return
• Mixed reaction to US banks repaying bailouts