Burberry drops on quarterly trading update

The price of shares in FTSE 100 fashion house Burberry (LON:BRBY) slipped 4.56% to 1,486.50p (as of 11:55 BST) after comparable Q1 sales dropped by 45% due to COVID-19. The decline narrowed considerably in the later periods of the quarter and lagged by 20% during June.

CEO Marco Gobbetti commented: “In Q1, sales were severely impacted by the drop in luxury demand from COVID-19 and we expect it will take time to return to pre-crisis levels with the resumption of overseas travel. We are encouraged by the improving trends in all regions and the promising exit rate for June. We saw an excellent response to new product launches in recovering economies as well as online. Demand for leather goods was particularly strong in Mainland China and Korea, bringing new, younger luxury customers to the brand. As we enter the second phase of our strategy, we are sharpening our focus on product and making other organisational changes to increase our agility and generate structural savings that we will be able to reinvest into consumer-facing activities to further strengthen our luxury positioning“.