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Burberry has unveiled a turnaround plan after it posted an adjusted operating loss of £41m for the six months ended 28 September.
This is a large fall from the £223m profit it posted in the same period last year and comes alongside a revenue drop of 20%.
Furthermore, comparable store sales fell by 20% year-on-year, reflecting ongoing challenges, including price increases, especially in leather goods.
As a result of this Burberry has introduced a £40m cost-saving programme and suspended its dividend for 2025
Moreover, the fashion house will focus on its core strengths, including its outerwear and scarves.
Alongside this Burberry will re-align pricing, particularly in leather goods, to better reflect its category authority.
Joshua Schulman, CEO, said: “My first few months have reaffirmed my belief that Burberry is an extraordinary luxury brand, quintessentially British, equal parts heritage and innovation. Burberry’s original purpose to design clothing that protects people from the weather is more relevant than ever.
“Our recent underperformance has stemmed from several factors, including inconsistent brand execution and a lack of focus on our core outerwear category and our core customer segments. Today, we are acting with urgency to course correct, stabilise the business and position Burberry for a return to sustainable, profitable growth.”
He added: “We have a powerful brand with broad appeal among luxury customers, authority in the outerwear and scarf categories which have remained resilient through this period, and a strong presence in all key luxury markets. Now, we have a clear framework to reignite brand desire, improve our performance and drive long-term value creation. Building on our strong foundations, I am confident that Burberry’s best days are ahead.”
