Burberry feels the pandemic’s impact

Burberry feels the pandemic’s impact

Burberry to scrap 50 million to keep itself afloat

The pandemic made no exception when it took a swing at companies. The one in our attention today is Burberry – the British luxury fashion house.

During the last quarter, the London-headquartered company reported a 48% decrease in retail sales, all the way down to 257 million pounds. Europe and the Middle East made up for 75% of it due to store and office closure. In the UK, closed stood closed for longer than Asia and Europe.

To protect and keep itself afloat, the company announced that it would dismiss 500 people. The number represents roughly 5% of the total workforce, as the company has 3,500 people employed. Out of the 500, 150 will be in the UK and the rest from overseas. The company's goal is to save 55 million pounds/year.

As far as the store closure goes, no stores outside the Kingdom will be shut down, but Burberry will cut on staff and will implement a work from home shift in some areas. However, the 13 stores in Hong Kong will be under review, as the Coronavirus and the pro-democracy protests impacted the sales. At the moment, the area accounts for 3% of the company's overall sales.

Burberry has been in a pickle for quite some time, as last year it canceled the shareholders' 120-million-pound payment and was part of the UK' government-backed support scheme. The program brought the company 300 million pounds.

Currently, the company is trading at -6.30%.

Read more about the earnings season on CAPEX.com!

Sources: theguardian.com, cnbc.com, finance.yahoo.com

The information presented herein is prepared by CAPEX.com and does not intend to constitute Investment Advice. The information herein is provided as a general marketing communication for information purposes only and as such it has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is not subject to any prohibition on dealing ahead of the dissemination of investment research.

Users/readers should not rely solely on the information presented herewith and should do their own research/analysis by also reading the actual underlying research. The content herewith is generic and does not take into consideration individual personal circumstances, investment experience or current financial situation.

Therefore, Key Way Investments Ltd shall not accept any responsibility for any losses of traders due to the use and the content of the information presented herein. Past performance is not a reliable indicator of future results.