Burberry said goodbye to its CEO of two years Jonathan Akeroyd as it announced downbeat financial results on Monday.
Joshua Schulman, former boss of Michael Kors, Coach, and Jimmy Choo, will take over the helm as CEO and executive director.
In light of a downturn in the luxury market, Burberry shared a profit warning and was forced to axe its full-year dividend. The firm said that Akeroyd would step down "with immediate effect by mutual agreement" with its board.
"Our Q1 FY25 performance is disappointing," said Gerry Murphy, Chair of Burberry, referring to the period from the start of April to the end of June.
"We moved quickly with our creative transition in a luxury market that is proving more challenging than expected. The weakness we highlighted coming into FY25 has deepened and if the current trend persists through our Q2, we expect to report an operating loss for our first half."
Burberry noted that aside from Japan, store sales were down in all markets during its first quarter. In the South Asia Pacific market, sales fell by a dramatic 38% on the year, while global sales dropped 21%.
This comes after Burberry announced a 40% fall in full-year profits in May.
Compared to other luxury brands, the British fashion house has been hit particularly hard by a depression in the high-end market, driven by a slowdown in pandemic-era spending.
Firms like Hermes and Prada have emerged resilient, while Gucci-owner Kering joins Burberry in hot water.
Shares in the British fashion house were down around 15% late morning, despite the efforts of Chair Gerry Murphy to strike a note of optimism.
"We expect the actions we are taking, including cost savings, to start to deliver an improvement in our second half and to strengthen our competitive position and underpin long-term growth," he said in a statement.
Disclaimer: The copyright of this article belongs to the original author. Reposting this article is solely for the purpose of information dissemination and does not constitute any investment advice. If there is any infringement, please contact us immediately. We will make corrections or deletions as necessary. Thank you.
