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Burberry Shares Jump on Moncler Bid Report

A Burberry logo displayed outside its store on New Bond Street in London, Britain, July 15, 2024. (Reuters)
A Burberry logo displayed outside its store on New Bond Street in London, Britain, July 15, 2024. (Reuters)
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Burberry Shares Jump on Moncler Bid Report

A Burberry logo displayed outside its store on New Bond Street in London, Britain, July 15, 2024. (Reuters)
A Burberry logo displayed outside its store on New Bond Street in London, Britain, July 15, 2024. (Reuters)

Burberry shares rose as much as 8% on Monday after a media report said Italian luxury outerwear maker Moncler was considering a bid for the British luxury retailer.

Moncler, known for its puffer jackets, on Sunday, said it would not comment on "unsubstantiated rumors" of a possible deal between the two luxury brands.

Burberry, which had a market valuation of nearly 3 billion pounds ($3.89 billion) as of the last close, did not immediately respond to a Reuters request for comment on Monday.

The company's shares, which jumped to 876.6 pence in early trading, pared gains to trade around 3.5% higher by 0732 GMT. The stock has plummeted about 40% so far this year.

Moncler shares, largely flat at 50.8 euros currently, fell as much as 1.5% early in the session.

Burberry, known for dressing the English upper class in its classic camel, red, and black check prints, has lagged behind its peers as it struggles to revive demand for its clothing.

It scrapped its dividend and issued a profit warning in July.

Broadly, luxury groups have struggled with tighter consumer spending in recent quarters, especially in China, with Moncler reporting a 3% drop in third-quarter sales last month.

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Fashion

UK Retailer Next Expects to Join 1 Billion Pound Profit Club

Signage on the exterior of a Next clothing retail store is seen in London, Britain, March 25, 2023. REUTERS/Toby Melville/File Photo
Signage on the exterior of a Next clothing retail store is seen in London, Britain, March 25, 2023. REUTERS/Toby Melville/File Photo
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UK Retailer Next Expects to Join 1 Billion Pound Profit Club

Signage on the exterior of a Next clothing retail store is seen in London, Britain, March 25, 2023. REUTERS/Toby Melville/File Photo
Signage on the exterior of a Next clothing retail store is seen in London, Britain, March 25, 2023. REUTERS/Toby Melville/File Photo

Next said on Wednesday it expected to report annual profit in excess of 1 billion pounds ($1.3 billion) for the first time in its history, underscoring the success of the British clothing retailer.
The group raised its outlook again after a better-than-expected 7.6% rise in third quarter to Oct. 26 full-price sales, driven by the early arrival of colder weather this year, versus an unusually warm September and early October last year, Reuters reported.
Breaking through the 1 billion pound profit mark would cap Next's position as one of the best run retailers in Britain, having found a successful recipe combining more than 800 stores in the UK and Ireland and nearly 8 million online customers.
It also has nearly 2 million overseas customers buying through its website and many more who buy its products via third party websites, or so-called aggregators.
The strong performance, which puts it in the ranks of supermarket Tesco and clothing and food retailer Marks & Spencer as British retailers to have made a profit of over 1 billion pounds, has sent its shares up by 47% over the last year, hitting a record high in September.
The company, which is considered a useful gauge of how consumers are faring, raised its guidance for the fourth quarter by 1 percentage point to 3.5%. It was the third increase to its outlook in four months.
It said the improved sales in the third quarter along with its forecast for the fourth quarter added 43 million pounds to full-price sales and 10 million pounds to profit.
That took its profit guidance for the 2024-25 year from 995 million pounds to 1.005 billion.
Official data published earlier this month showed UK retail sales unexpectedly rose in September. However, other retailers have said shoppers remained nervous about spending on discretionary items ahead of the new Labour government's budget statement later on Wednesday.