Burberry is flagging a loss for the fiscal first half after its first-quarter sales plummeted across Asia Pacific and other regions.
The luxury fashion retailer said its CEO Jonathan Akeroyd has stepped down and left the company with immediate effect by “mutual agreement with the board”. Former Michael Kors boss Joshua Schulman is its new CEO and executive director.
For the 13 weeks ended June 29, the company’s retail revenue dipped 22 per cent to £458 million (US$595 million), with comparable store sales down 21 per cent.
In Asia Pacific, comparable store sales fell 23 per cent, including decreases of 21 per cent in Mainland China, 38 per cent in South Asia Pacific and 26 per cent in South Korea. Japan went against the trend with a 6 per cent improvement.
In the EMEIA (Europe, the Middle East, India, and Africa) and Americas regions, comparable store sales declined 16 per cent and 23 per cent respectively.
Gerry Murphy, chair of Burberry, said the first-quarter performance was “disappointing” as the luxury market has become more challenging than expected.
The slowdown in trading has continued into July and if it persists through the current quarter, the company would expect to report an operating loss for the first half.
The retailer has taken several actions including cost savings, which are expected to deliver an improvement in the second half.
The board has decided to suspend dividends for the time being until the company returns to a suitable level of profitability.
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