Burberry bounces despite poor profits

The price of shares in FTSE 100 fashion house Burberry (LON:BRBY) climbed by 4.91% to 1,442.50p (as of 12:25 BST) despite the firm reporting a 57% fall in operating profits for the year ended 28th March. Revenues for the period were down by 3% and management said that they expected further declines during the first quarter of the current year due to the COVID-19 situation. 50% of the company’s stores remain closed and the company is working to conserve cash and leverage digital platforms, but no guidance of FY2021 is being provided at this time.

CEO Marco Gobbetti commented: “Prior to Covid-19, we were delivering strong momentum across our brand and product, with sales ahead of our expectations. Since then, the global health emergency has had a profound impact on the world, our industry and Burberry but I am very proud of the way we have responded. We have taken swift action to mitigate the financial impact on our business, while prioritising the safety and wellbeing of our teams and customers. We have a strong balance sheet and liquidity, with space for investment when markets recover. We have found new ways to strengthen our connection with consumers, drawing on our digital leadership. We have also mobilised our resources in support of the relief efforts. It will take time to heal but we are encouraged by our strong rebound in some parts of Asia and are well-prepared to navigate through this period. Now, more than ever, our strategy to secure our position in luxury fashion is key. I would like to thank our teams for their dedication and leadership during these challenging times“.