Luxury : Burberry lost more than a quarter of its sales

The group of british luxury Burberry is expected to months very difficult due to the pandemic of sars coronavirus. The brand of clothing and luxury accessories, has suffered a fall of 27% of its sales in the first three months of 2020, according to a press release published this morning. About 60% of its shops have closed at the end of march or at the beginning of the confinement in several countries in Europe.

read also : The luxury shopping resigned to the rich tourist clientele

The year 2020-2021 (completed at the end of march) had yet started well for the group, whose sales were up and better than expected. But the pandemic, which has stifled sales in Asia in February, has changed everything and its annual net income has finally been divided by nearly three to 121.6 million pounds. The paralysis of the activity at a cost of 245 million pounds due to the closures of shops and unsold inventories.

"It will take time to get better"

The brand to the iconic printed graph does not forecast figures for the next few months, but anticipates a first quarter (April to June) "severely affected" by the closure of shops that relate in this moment 50% of its network. "It will take time before it get better but we are encouraged by the strong rebound in some regions in Asia and we are well prepared to weather this period," said Marco Gobbetti, ceo of Burberry.

read also : The luxury restarts its production in an ecosystem weakened by the pandemic

The group has observed an improvement of its activity by the end of the fiscal year in mainland China, thanks to the reopening of all these stores in the country. And this trend has continued in early April, so well that its sales in China and south Korea, two markets essential to Burberry, are better than last year. He assigns a portion of the increase to the fact that the Chinese are buying in their country because they can do it abroad.

"His rich customers continue to spend"

investors welcomed the publication. The title of the group was 2.91% to the London stock Exchange to 11 hours. "The problems will not go away once the restrictions are lifted," warns Sophie Lund-Yates, an analyst at Hargreaves Lansdown. She reminds us that the brand is highly dependent on rich tourists who buy its products overseas, particularly Asian. Gold tourism, in particular, trans-continental will leave that "will continue to penalize its performance," she says. On the other hand, the analyst believes that the group is better armed to deal with the recession. "His rich customers continue to spend regardless of the state of the economy, as Burberry's strategy to get even more range to improve its margins," she says.

1 commentairedessolesle 22/05/2020 11:50

Earnings divided by 3.....ok....but profit anyway... So everything is going very well for Burberry.. At least the race to the money for the shareholders is that the only justification... And if c is the case, c is even less severe.

Read the comment