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Burberry Announces Turnaround Plan as Sales Continue to Slide

FILED - 22 August 2018, England, London: A general view of the Burberry logo displayed on the facade of its store in New Bond Street. Photo: Yui Mok/PA Wire/dpa
FILED - 22 August 2018, England, London: A general view of the Burberry logo displayed on the facade of its store in New Bond Street. Photo: Yui Mok/PA Wire/dpa
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Burberry Announces Turnaround Plan as Sales Continue to Slide

FILED - 22 August 2018, England, London: A general view of the Burberry logo displayed on the facade of its store in New Bond Street. Photo: Yui Mok/PA Wire/dpa
FILED - 22 August 2018, England, London: A general view of the Burberry logo displayed on the facade of its store in New Bond Street. Photo: Yui Mok/PA Wire/dpa

Burberry's new CEO Joshua Schulman announced a turnaround strategy for the struggling British luxury brand on Thursday, as sales continued to slide in its second quarter.
Burberry suspended its dividend for 2025 and announced a 40 million pound ($50.73 million) cost savings program. According to Reuters, Schulman said the brand needed to focus back on outerwear and its core customer.
"Today, we are acting with urgency to course correct, stabilize the business and position Burberry for a return to sustainable, profitable growth," Schulman said in a statement.
Sales in Burberry's second quarter ending Sept. 28 fell at the same pace as the first, with revenue for the first half down 20% in constant currency.

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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.