by Apparel Resources News-Desk
17-May-2019 | 1 min read
Burberry, the British luxury fashion brand, saw a fall in its shares on 16 May owing to poor sales growth especially in Mainland China.
Notably, in the year that ended in March 2019, the sales in the Asia-Pacific region saw low single-digit growth. This was mainly due to overall economic slowdown which kept the consumers away.
Chinese consumers constitute 40 per cent of earnings globally. In the second half of year too, the sales growth across all regions was mere 1 per cent, a drop of 3 per cent from the first half.
By the end of Thursday, Burberry’s shares slumped by 5.9 per cent. According to analysts, while the fashion brand expected flat revenues and margins at constant exchange rates in its existing financial year, currency movements would shave about £7m off full-year profit.
In fact, not all is negative. The new designs from creative director Riccardo Tisci have included more influence from streetwear styles and a new logo and monogram. And this is now paying off after Burberry reported a rise of 2.3 per cent in comparable revenue for the last financial year.
The company has increased its cost-saving target to £135m every year by 2022, and announced another £150m share buyback. However, it warned that the present year’s results would be unusually weighted towards the second half.
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