BURBY - Burberry Group plc

Other OTC - Other OTC Delayed Price. Currency in USD
15.97
-0.52 (-3.14%)
As of 10:03AM EDT. Market open.
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Previous Close16.49
Open15.88
Bid0.00 x 0
Ask0.00 x 0
Day's Range15.85 - 16.03
52 Week Range12.31 - 30.91
Volume10,198
Avg. Volume172,374
Market Cap6.337B
Beta (5Y Monthly)0.69
PE Ratio (TTM)15.28
EPS (TTM)N/A
Earnings DateN/A
Forward Dividend & Yield0.30 (1.80%)
Ex-Dividend DateDec 18, 2019
1y Target EstN/A
  • Retailers Start Usefully Quantifying Virus Impact
    Bloomberg

    Retailers Start Usefully Quantifying Virus Impact

    (Bloomberg Opinion) -- As measures to curb the coronavirus heap pressure on the global retail sector, observers have struggled to quantify the economic ramifications. There are signs that affected companies are offering some useful disclosure that may in turn help sentiment. Adidas AG last week outlined a roughly $1 billion reduction in first quarter sales and $500 million impact on operating profit, but that was before many countries outside Asia started taking aggressive steps in response to the crisis.Now Next Plc has provided more expansive detail about how it sees the months ahead. With shares in most retailers in freefall – Next is down about 40% this year – investors needed to hear something constructive. While the U.K. fashion chain said it could not give guidance for the full year, it has produced a stress test that outlines potential outcomes.In a worst-case scenario, full-price sales would be down by about 1 billion pounds ($1.16 billion), a quarter of its total, which would mean pre-tax profits of just 55 million pounds for the financial year (against 729 million pounds in the year earlier).The company has also set out how it might cope with the crisis financially, given the possibility of extended store closures. It could suspend buy-backs and dividends, delay capital expenditure, sell and lease a warehouse and partly securitize customer debts. Pulling these levers could provide an extra 835 million of cash. Bringing forward its forthcoming sale, and pushing back deliveries of stock would free up another 100 million pounds.These projections exclude any use of government lending or measures to help pay wages, and Next is conservatively assuming no rent reductions from landlords.This disclosure dashboard sets a good example for others to follow. But Next can afford to be upfront with its investors. It is one of the strongest retailers in the U.K. sector.Similarly, Burberry Group Plc provided some near-term clarity, warning that fourth-quarter comparable sales in its stores would be down by 30%, with a 70-80% decline in the final weeks through to its March 31 financial year-end. Like Next, the luxury group has a strong balance sheet, with the company forecasting a cash balance of 600 million pounds before lease obligations.It is understandable why weaker chains may be less willing to quantify the impact on their businesses. But their investors will expect a similar assessment of possible scenarios. And larger, well-resourced chains have no such excuse for not saying more.Take Inditex SA, the world’s biggest clothing retailer. It said the outbreak had cut its sales by 24% between March 1 and March 16. But it didn’t outline the potential full-year impact. This is from a company with record net cash of 8.1 billion euros ($8.7 billion) at January 31.There will be many more tough announcements over coming weeks as retailers and restaurants outline the financial cost of what is happening now. But even if they can’t make exact predictions, they should learn from Next’s example and aim to at least give the market a toolkit for understanding the resilience of their business. Next shares’ strong gain in a falling market on Thursday suggests transparency is rewarded.This column does not necessarily reflect the opinion of Bloomberg LP and its owners.Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Barrons.com

    Burberry Reopens China Stores. There Is Light at The End of The Tunnel But It Will Get Worse First.

    Burberry stock fell on Thursday as the luxury brand said sales have plunged up to 50% in the past six weeks and warned it would get worse.

  • What Is Burberry Group's (LON:BRBY) P/E Ratio After Its Share Price Tanked?
    Simply Wall St.

    What Is Burberry Group's (LON:BRBY) P/E Ratio After Its Share Price Tanked?

    Unfortunately for some shareholders, the Burberry Group (LON:BRBY) share price has dived 34% in the last thirty days...

  • Why Burberry Group plc (LON:BRBY) Is A Dividend Rockstar
    Simply Wall St.

    Why Burberry Group plc (LON:BRBY) Is A Dividend Rockstar

    Today we'll take a closer look at Burberry Group plc (LON:BRBY) from a dividend investor's perspective. Owning a...

  • Barrons.com

    Goldman Sachs Is Warning of No Earnings Growth This Year. Here’s How to Prepare.

    Strategist David Kostin said S&P 500 companies could see no profit growth this year if the coronavirus continues to spread—and that calls for a more-defensive and domestically-oriented portfolio.

  • Burberry: Another Century-Old Business With a Moat and Growth Opportunities
    GuruFocus.com

    Burberry: Another Century-Old Business With a Moat and Growth Opportunities

    Thanks to the lack of change, the luxury sector is full of easy-call names for long-term investors Continue reading...

  • Fashion house Chanel cancels Beijing show due to coronavirus
    Reuters

    Fashion house Chanel cancels Beijing show due to coronavirus

    Chanel has cancelled a show in China in May due to the coronavirus outbreak, the French fashion house said on Tuesday. "Considering the current situation and following the guidance of Chinese authorities, Chanel has decided to postpone its project of a replica of the Paris – 31 rue Cambon 2019/20 Métiers d’art collection in May in Beijing to a later and more appropriate moment," the statement said. Chanel was monitoring the situation closely, saying "At the foremost are the health and well-being of its teams and clients".

  • Reuters

    Burberry's Tisci re-imagines classics in London runway show

    Riccardo Tisci drew inspiration from Burberry's design heritage by re-imagining the British label's trenchcoats and camel, black and red check at London Fashion Week on Monday. U.S. models Kendall Jenner, Bella Hadid and Gigi Hadid, and Russian Irina Shayk, walked in an Autumn-Winter 2020 collection that featured the house's signature neutral tones and references to old-style English tailoring and vintage sportswear.

  • Reuters

    Ralph Lauren warns of up to $70 mln hit to Asia sales from coronavirus

    Ralph Lauren Corp said on Thursday it expects a $55 million to $70 million hit to its fourth-quarter sales in Asia from the coronavirus outbreak in China. About two-thirds of Ralph Lauren's 110 stores in China have been temporarily closed over the past week, the luxury goods maker said. Supply chain disruptions in China could also impact a small portion of fourth-quarter orders globally, Ralph Lauren said.

  • Should You Be Excited About Burberry Group plc's (LON:BRBY) 28% Return On Equity?
    Simply Wall St.

    Should You Be Excited About Burberry Group plc's (LON:BRBY) 28% Return On Equity?

    While some investors are already well versed in financial metrics (hat tip), this article is for those who would like...

  • Gucci-owner Kering warns coronavirus could hit its business this year, but ‘impossible’ to gauge any damage yet
    MarketWatch

    Gucci-owner Kering warns coronavirus could hit its business this year, but ‘impossible’ to gauge any damage yet

    Gucci-owner Kering says half of China stores shut because of coronavirus outbreak as it posted a 16.2% rise in full-year revenue.

  • Morgan Stanley Foresees Potential 5% Dip in Burberry 2019-20 Earnings
    WWD

    Morgan Stanley Foresees Potential 5% Dip in Burberry 2019-20 Earnings

    LONDON — Burberry stopped short of issuing a sales and profit warning last Friday, but now Morgan Stanley has done it for them.On Tuesday the bank wrote a research note that Burberry’s comments about the impact of the coronavirus “might imply” a downgrade to  2019-20 earnings in the region of 5 percent.The bank pointed out that Burberry is the soft luxury company with the highest retail sales exposure to Chinese nationals, and was the first of its peers to issue an official warning about the material impact of the coronavirus on its operations in mainland China and Hong Kong.Some 40 percent of Burberry’s sales come from Chinese customers buying both at home and abroad.As reported on Feb. 7 Burberry said 24 of its 64 stores in mainland China were closed, with the remainder operating with reduced hours and “seeing significant footfall declines.”Burberry added that the spending patterns of Chinese customers in Europe and other tourist destinations have been less impacted to date, “but given widening travel restrictions, we anticipate these to worsen over the coming weeks.”Morgan Stanley is assuming the ongoing disruption will cause a 50 percent to 60 percent drop in Burberry’s sales to Chinese nationals over the coming two months. (Burberry's fiscal year ends on March 31.)The bank said the sales drop would result in an approximate 3 percent reduction to its own full-year sales estimates for the brand. Those figures do not take into account Burberry’s wholesale business.It added that Burberry's operating profit could see up to a 10 percent drop in the second half of the year, implying "a mid-single-digit downgrade to FY20 earnings," which is how it got to the 5 percent.Morgan Stanley said it would expect Burberry to recover part of that lost sales growth in fiscal 2020-21, "assuming the impact from the outbreak is temporary, and the situation normalizes by April.”The bank was quick to add that should the drop in sales be more severe than its 50 percent to 60 percent assumption, or should the impact on sales last longer than just two months, “earnings could see a more meaningful cut.”It also said that with regard to the impact of the virus, Burberry stands apart from its peers.“While this upcoming headwind was largely expected by the market, particularly after similar warnings from other brands (such as Nike and Pandora), interestingly the luxury sector has so far proved to be particularly resilient from a share price performance perspective," the bank wrote. "Investors are seemingly looking past these imminent downgrades, which are not expected to affect the solid, underlying, structural growth drivers of the sector."Given Burberry's ongoing turnaround, the bank warned that the British brand might be seen by the market as slightly more vulnerable compared to other more established companies such as LVMH Moët Hennessy Louis Vuitton, Hermès and Kering, particularly given that the virus outbreak will delay the inflection point in Burberry's sales and profits growth expected over the coming couple of quarters. More from WWD * Burberry Says Year-end Results Will Be Impacted by Coronavirus * Burberry Defiant in Face of Hong Kong Slowdown, Macro Challenges * More Tisci Products Nudge Burberry Retail Revenues Up 1% in Q3

  • The Coronavirus Fallout: Six Months for Starters
    WWD

    The Coronavirus Fallout: Six Months for Starters

    There are still more coronavirus questions than answers. How long it will last, how far it will spread and just how bad it will be all remain uncomfortably uncertain. But when thinking about the commercial fallout, there is a place to start — six months.Even though the deadly coronavirus has really only taken off over the past couple of weeks, it is already having a dramatic impact on the global fashion business, which counts China a key market for both sales and production. And the industry can expect to be dealing with lower revenues and supply chain headaches for at least a few quarters, and potentially longer if the outbreak that has brought industry in China to a crawl hits other markets hard.Many of the larger companies have said at least half or more of stores in China are closed and that the ones that are open aren’t seeing much foot traffic. Although most have chosen to not publicly estimate the financial impact — some have ventured a guess in recent days, while others have simply stated that it will be “material.” Capri Holdings, parent to Michael Kors, Versace and Jimmy Choo, expects a $100 million hit to sales to its fiscal fourth quarter, which is ongoing.Competitor Tapestry Inc., which owns Coach, Kate Spade and Stuart Weitzman, is just headed into its fiscal third quarter and went further, noting it could lose $200 million to $250 million in sales during the second half, while earnings take a hit of $97 million to $124 million (35 cents to 45 cents a share).Joanne Crevoiserat, Tapestry’s chief financial officer, took analysts on a conference call through the math, perhaps the most explicit public accounting of how the coronavirus is weighing on fashion. “The situation is still unfolding….it's very dynamic. We are providing transparency based on what we're seeing today,” she said on Thursday.“The assumptions are based on what — today, we see a low to mid-teens percent of our business in Mainland China across all brands, with the predominance in Coach brand, where the outlook is an expectation of a 70 percent to 80 percent decrease in those sales through the rest of the year,” Crevoiserat said.Even if Coach ends up being hit particularly hard, an 80 percent drop in sales for the five months left in Tapestry’s fiscal year is not so much a slowdown as a collapse and one that suggests strongly that everyone is being hit very hard, especially given that the country is the great consumer hope for fashion and particularly luxury.China is shut down, at least right now, and the impact of the coronavirus is rippling out. Panos Kouvelis, a professor of operations and manufacturing management at the Olin Business School at Washington University in St. Louis, said the coronavirus could have a $300 billion-plus impact on the global supply chain and last up to two years. “The coronavirus is an uncharted-territory event. It’s a ‘black swan,’ which is a low-probability event with big consequences. The benchmarks we had in the past aren’t fully applicable because of the increased significance of China in the global economy, combined with our heavy dependence on China both as a market and as a manufacturing hub for goods that are more complex and more sophisticated than they were in 2002. So whatever we know from SARS is not a good predictor of the coronavirus’ likely impact,” Kouvelis said on the school’s web site.China is still the largest apparel producer and accounted for 29.7 percent of all apparel imports to the U.S. last year, valued at $24.9 billion, according to the Commerce Department. Many companies have spent the last few years diversifying away from China, hoping to skirt the big tariff increases of the U.S.-China trade war. But the country is still too big for many to avoid. And companies that reacted to the trade war by shifting production in China so goods made there are destined for Europe or another market besides the U.S., still run into coronavirus trouble. VF Corp., owner of Vans, The North Face and Timberland, said 12 percent of its sales come from the Asia Pacific region (6 percent from Mainland China), but that 16 percent of its total cost of goods sold comes from China (7 percent, or nearly half of that, is destined for the U.S. market).The supply chain can be disrupted in any number of ways. What good is a factory if it can’t get raw materials? And what good is finished product if the ports are closed? And so on. And even if fashion production is relatively untouched, other sectors and their supply chains could get tangled up enough to derail the global economic expansion.The coronavirus outbreak could also break out wider, creating an even more complex global picture. Already, the situation in parts of China is getting more desperate with quarantine sites being set up, flights canceled and factories closed.It will take a long time for life to return to normal, but fashion leaders expect consumers to come back, eventually.“While we cannot currently predict how long this situation will last, we remain confident in our strategy. In the meantime, we are taking mitigating actions and every precaution to help ensure the safety and well-being of our employees,” said Marco Gobbetti, chief executive officer of Burberry Group. Twenty-four of Burberry’s 64 stores in Mainland China are closed. Canada Goose Holdings cut its annual revenue outlook to as low as 13.8 percent growth instead of “at least 20 percent” given about two months of severe coronavirus impact. But chief executive officer Dani Reiss said the business would be back. “This sudden change in consumer behavior is temporary and unrelated to underlying demand for our brand,” he said. “We believe that we're poised to resume our strong growth trajectory in Greater China when this is over.”That bounce back seems to be at least six months away. WWD List: China Exposure The coronavirus outbreak has transformed a large China business into a sudden source of concern. Portion of Total Revenues Region Prada SpA 22% China Adidas AG 21% China Nike Inc. 17% China Tapestry Inc. Low to midteens % China Guess Inc. * 12% China Brunello Cucinelli SpA 10% China PVH Corp. 10% China Lululemon Athletica Inc. * 5% China Ralph Lauren Corp. <4% China Levi Strauss & Co. 3% China Hermès International SA 52% Asia/Pacific (excluding Japan) Burberry Group plc 39% Asia/Pacific Salvatore Ferragamo Italia 39% Asia/Pacific Compagnie Financière Richemont 37% Asia/Pacific L'Oréal SA 32% Asia/Pacific Kering SA 32% Asia/Pacific (excluding Japan) LVMH Moët Hennessy Louis Vuitton 30% Asia (excluding Japan) Tiffany & Co. 30% Asia/Pacific Puma AG 28% Asia/Pacific The Estée Lauder Cos. Inc. 28% Asia/Pacific Canada Goose Holdings Inc. 18% Asia Capri Holdings Ltd. 17% Asia Under Armour Inc. 12% Asia/Pacific VF Corp. 12% Asia/Pacific Source: Company reports, statements (* indicates an estimate from Cowen equity research). More from WWD * Canada Goose's Dani Reiss on the Coronavirus, Brand Heat and Retail * Vans-parent VF Closes 60 Percent of Stores in China * Coronavirus Hits Canada Goose Outlook

  • Coronavirus update: Business impact widens as China fights to get infections under control
    Yahoo Finance

    Coronavirus update: Business impact widens as China fights to get infections under control

    China’s deadly coronavirus outbreak continues to threaten multi-national companies, as a range of businesses from leisure to retail suffer from the outbreak’s after-effects.

  • There’s a Lesson for Luxury in the Coronavirus Crisis
    Bloomberg

    There’s a Lesson for Luxury in the Coronavirus Crisis

    (Bloomberg Opinion) -- With the death toll from the coronavirus rising, the fate of high-end handbag sales still seems of minor consequence. But the $300 billion luxury industry’s over-dependence on Chinese spending was underlined again on Friday when British fashion house Burberry  Group Plc said it could no longer stand by its previous financial forecast because of the spread of the illness.Just two weeks ago, the company shrugged off disruption in Hong Kong to lift its outlook for sales growth excluding currency movements to a percentage in the low single digits, while anticipating that the operating margin would be broadly stable in the year to March 2020. Analysts at Morgan Stanley said Friday’s warning could imply a 5% cut to 2020 earnings.Burberry is particularly exposed to the epidemic. It generates about 40% of its sales from Chinese consumers at home and abroad. That’s above the 35% for the industry as a whole, according to Bain & Co. and Altagamma. So shutting some shops on the mainland and reducing hours at others has an out-sized effect.It’s too early to know what the end result will be for Burberry and the industry as a whole, but one key lesson is coming into sharp relief: While Chinese shoppers are a powerful force for the industry, no brand should neglect their customers closer to home, or stop trying to drum up demand in other corners of the world. When the Chinese market slumped in 2015 and 2016 because of a government crackdown on extravagance and gyrating stock markets, luxury houses all pivoted toward shoppers in Europe and the U.S. They have lost sight of the need to foster these markets since.For Burberry, it’s a particularly sensitive time to face such uncertainty in its biggest market. The group is in the midst of trying to revive its brand, best known for its black, white, tan and red check. While new iterations, such as the TB Monogram, are gaining traction, Burberry is having to prioritize. It’s now unclear whether a fashion show in Shanghai in April, will go ahead. The first Chinese showcase under new designer Riccardo Tisci will have specially created merchandise, clearly a way to build Burberry’s profile amid its rejuvenation efforts.Given these characteristics — high Chinese exposure plus a turnaround strategy — Prada SpA also looks to be at risk, and the Italian maker of the iconic nylon bag has already closed some stores in mainland China and Macau. The list of other luxury companies that are very dependent on China and Hong Kong is long. Swatch Group AG and Richemont are the most exposed, according to analysts at Bernstein. And Gucci, which accounts for 60% of French parent Kering SA’s sales and 80% of its operating profit, has been a hit with Chinese shoppers over the past three years. Anyone who has witnessed the proliferation of Gucci T-shirts, not all the real thing, in cities from Shanghai to Beijing would attest to its popularity.By contrast, Bernard Arnault’s LVMH looks to be better prepared to handle such a shock. With brands including Moet & Chandon champagne, pop star Rihanna’s beauty line and soon Tiffany & Co. jewelry, it has broad diversification by both geography and product range. Last year, for example, 24% of its sales from the U.S.But given the whole industry’s reliance on Chinese big spenders, no luxury or consumer brand with exposure to the them, wherever they shop, will be immune. Burberry said spending in Europe and other tourist destinations was less affected by the outbreak, but it expected conditions here to worsen too. This week, Coach owner Tapestry Inc., Michael Kors and Versace parent Capri Holdings Ltd. and Estee Lauder Cos. all lowered earnings guidance, citing the virus. Even luxury parka maker Canada Goose Holdings Inc., which has a strong following in the U.S. and Europe, has felt the impact of the outbreak. On Friday it lowered its full-year sales and profit guidance.Global luxury sales could expand by just 1% this year, according to analysts at Jefferies, after what they now expect to be a brutal 20% decline in Chinese demand in the first half. Before the outbreak, they were expecting the industry’s sales to grow by 5% in 2020.  While luxury shares have fallen over the past three weeks, valuations remain close to 10-year highs. As I have noted, the stocks have proved remarkably resilient in the face of everything from trade skirmishes to protests in Hong Kong.Burberry’s warning is a stark reminder that that could be about to change.To contact the author of this story: Andrea Felsted at afelsted@bloomberg.netTo contact the editor responsible for this story: Melissa Pozsgay at mpozsgay@bloomberg.netThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Barrons.com

    Burberry Stock Slips as Luxury Brand Warns Coronavirus is Hitting Sales

    Burberry shares fell on Friday as the global luxury brand warned the spreading coronavirus was hurting sales.

  • Reuters

    Sparkle fades as coronavirus risks wiping out luxury goods growth

    The luxury goods industry normally relishes the spotlight, but in the case of China's coronavirus it is rueing being one of the most globally exposed sectors to an epidemic that risks all-but wiping out its sales growth this year. Brands from Burberry to Estee Lauder are shutting stores and cutting profit forecasts as business in the industry's biggest market has virtually ground to a halt.

  • Burberry shares drop in London as luxury-goods group warns of coronavirus fallout
    MarketWatch

    Burberry shares drop in London as luxury-goods group warns of coronavirus fallout

    Burberry was among the losing shares in London, as the luxury-goods maker confirmed what investors had been suspecting - that the spreading coronavirus was hitting sales in the region.

  • Reuters

    European shares pause after record highs as virus fears grip

    European shares slipped slightly from all-time highs on Friday, as the rising death toll from the coronavirus outbreak and the pace of the spreading infection dulled sentiment. The pan-European stocks benchmark STOXX 600 fell 0.2% at 0805 GMT as the number of deaths from the flu-like virus climbed to 636 and confirmed cases of infection rose to 31,161 in China. China-exposed sectors such as basic materials, luxury and auto stocks, which have seesawed over the past two weeks on virus fears, were the biggest decliners on the day.

  • Burberry says coronavirus hurting luxury demand
    Reuters

    Burberry says coronavirus hurting luxury demand

    Burberry said the outbreak of the coronavirus was hitting luxury demand in China and Hong Kong, both important markets for the British fashion brand, sending its shares lower for a second day in a row. The label said 24 of its 64 stores in mainland China were closed and there was a significant decline in the number of shoppers visiting its remaining outlets, which were also opening for shorter periods each day. "The outbreak of the coronavirus in mainland China is having a material negative effect on luxury demand," Chief Executive Marco Gobbetti said.

  • Burberry Says Year-end Results Will Be Impacted by Coronavirus
    WWD

    Burberry Says Year-end Results Will Be Impacted by Coronavirus

    LONDON — Burberry is the latest fashion brand to be hit by the coronavirus in the all-important Chinese market.While Burberry did not issue a sales and profit warning on Friday, it did say that retail sales have been impacted by store closures in mainland China and Hong Kong.Currently 24 of its 64 stores in mainland China are closed, with remaining stores operating with reduced hours “and seeing significant footfall declines.”The company added that the spending patterns of Chinese customers in Europe and other tourist destinations have been less impacted to date, “but given widening travel restrictions, we anticipate these to worsen over the coming weeks.”The news sent shares down 1.43 percent to 19.88 pounds in late-morning trading on the London Stock Exchange. The share price recovered during the course of the day, closing down 0.1 percent at 20.15 pounds.Earlier this week, Capri Holdings Ltd., parent of Michael Kors, Versace and Jimmy Choo, warned that the ongoing coronavirus crisis will have a severe impact on its results in the next quarter — and potentially even a greater one depending on how long the health emergency lasts. The company said it expects the epidemic to reduce revenues by about $100 million in the fourth quarter. Burberry did not comment on whether or not it was still planning to stage its fall 2020 fashion show in Shanghai in April. Spend by Chinese consumers globally generates 40 percent of Burberry’s sales."The outbreak of the coronavirus in mainland China is having a material negative effect on luxury demand. While we cannot currently predict how long this situation will last, we remain confident in our strategy,” said Marco Gobbetti, chief executive officer.“In the meantime, we are taking mitigating actions and every precaution to help ensure the safety and well-being of our employees. We are extremely grateful for the incredible effort of our teams and our immediate thoughts are with the people directly impacted by this global health emergency," he added.The company said its most recent guidance for the fiscal year ended March 2020 predates the impact of the coronavirus outbreak and the company wanted to update the market.Burberry clarified that the “mitigating actions” it is taking will have a “limited” impact, given the proximity to its fiscal year-end on March 31, when it will provide a retail trading update."We also intend to continue our key growth initiatives in preparation for a recovery in luxury demand," it said. “We remain confident in our strategy and are very pleased with the positive response to our brand repositioning and new product. We will continue to focus on newness and fashion, and on inspiring and engaging our customers globally. We fully support the efforts the Chinese government is taking to contain the virus and we are working in close conjunction with local authorities and partners.”Burberry has already been suffering in Hong Kong: Last month, in its third-quarter trading update, it said Hong Kong, which generated 8 percent of Burberry’s sales last year, contributed just 4 percent in the third quarter due to a decline in mainland Chinese tourists and temporary store closures from the ongoing protests.At the time, despite the falloff in Hong Kong and the rise of the coronavirus in mainland China, Burberry had raised its revenue guidance, saying it expected full-year revenues to grow by a low single-digit percentage at constant exchange, compared to previous guidance of "broadly stable."It expected adjusted operating margin to remain broadly stable at constant exchange, despite the impact of disruptions in Hong Kong. For the full fiscal year, cumulative cost savings are set to be 125 million pounds, ahead of the 120 million pounds originally forecast.More from WWD * Burberry Defiant in Face of Hong Kong Slowdown, Macro Challenges * More Tisci Products Nudge Burberry Retail Revenues Up 1% in Q3 * Wuhan Virus Spooks Global Stock Market, Luxury Shares

  • Burberry warns of ‘material’ hit on demand from coronavirus
    MarketWatch

    Burberry warns of ‘material’ hit on demand from coronavirus

    The British luxury group said 24 out of its 64 stores in mainland China are closed, with the remaining operating with reducing hours and experiencing significant footfall declines.

  • Billionaire Bags a Bling Bargain
    Bloomberg

    Billionaire Bags a Bling Bargain

    (Bloomberg Opinion) -- Maverick retailer Mike Ashley likes a flutter at the casino. With his punt on a stake in upmarket handbag maker Mulberry Group Plc, the British billionaire can’t lose.Ashley’s Frasers Group Plc, formerly Sports Direct, said late Monday that it had acquired a 12.5% interest in Mulberry, maker of the iconic Bayswater bag. Ashley, who owns 63% of Frasers, has long dabbled with investments in rivals. Some, such as a holding in JD Sports Fashion Plc, paid off handsomely. But a 30% stake in Debenhams Plc was wiped out when the U.K. department store chain was taken over by its lenders last year.The interest in Mulberry has all the hallmarks of a winner. First, Ashley has likely picked it up on the cheap. Frasers did not disclose the cost. But at Monday’s close, the stake would be worth about 19 million pounds ($24.7 million).Shares in Mulberry have never really recovered from a botched strategy around five years ago, when Bruno Guillon, a former Hermes manager who was chief executive officer at the time, tried to take the leather goods and apparel company upmarket, alienating many of its core customers. New CEO Thierry Andretta and designer Johnny Coca, who joined from Celine, have since returned the brand to its accessible luxury heartland. But the shares remain about 85% off of their 2012 peak.Second, there’s clear strategic logic for Ashley to work more closely with Mulberry. The idea of transforming House of Fraser into the “Harrods of the high street” has been widely mocked because of the department store’s poor performance following its purchase in August 2018. But Ashley clearly wants to take the chain more upmarket. It’s likely to end up as a smaller, more high quality estate.Mulberry is currently in 19 House of Fraser stores, where it trades well. It is also available at Flannels, Ashley’s boutique that sells the likes of Canada Goose and Balenciaga, which is still flying.But there is another reason why Ashley’s interest in Mulberry might pay off. The quintessentially British brand has long been seen as a takeover target. Consolidation in luxury is intensifying, with LVMH’s $16.5 billion purchase of Tiffany & Co and speculation swirling around Moncler SpA and Prada SpA.  While it can’t be ruled out that Ashley will lift his interest further, a big luxury group could also make a move for Mulberry.It is tightly held, so any predator would have to convince the Ong family, which owns 56%, to sell. That may not be easy given that the value of its stake has fallen over recent years. But it may be worth trying given that quality assets are rare, especially those without a big stake held by the families that founded the companies. Longer term, there’s also the possibility that Burberry Group Plc, if its turnaround works, could be interested as part of any future efforts to turn itself into a British luxury conglomerate.In the event of any approach, Ashley not only stands to gain financially, but secures a seat at the table when it comes to this strategically important brand.Conversely, there’s nothing to stop Ashley filling his luxury shopping bag elsewhere. For example Burberry, still in the midst of its turnaround right now, commands a large selling area in Flannels’ new flagship store on Oxford Street for its street wear and rejunvenated accessories.Mulberry might not be this billionaire’s last bling bet. To contact the author of this story: Andrea Felsted at afelsted@bloomberg.netTo contact the editor responsible for this story: Melissa Pozsgay at mpozsgay@bloomberg.netThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Luxury outlet visited by millions of Chinese tourists faces coronavirus impact
    MarketWatch

    Luxury outlet visited by millions of Chinese tourists faces coronavirus impact

    Every year millions of Chinese consumers fly into London and board a train to the small Oxfordshire town of Bicester.

  • Reuters

    RPT-GRAPHIC-Why the 'devil' coronavirus has hit European stocks hard

    A whopping $200 billion was wiped from European stocks at the start of this week as the deadly coronavirus prompted investors to cut back exposure to companies with a strong presence in China, the world's fastest-growing consumer market. Hundreds of millions of people have been preparing to travel for the Chinese holidays, stoking concerns infection rates may accelerate during the period - which is also a peak retail season in China and overseas. The virus - which Chinese President Xi Jinping has described as a "devil" - has had a bigger impact on European companies than their U.S. peers due to their high revenue exposure to China.