Troubled Burberry slashes 1,700 jobs but boss insists British fashion giant's best days are ahead
The boss of Burberry yesterday insisted the company's 'best days are ahead' as he outlined plans to slash 1,700 jobs – including 750 in the UK.
Joshua Schulman said he was 'more optimistic than ever' about the outlook despite cuts that will see it axe a quarter of its 3,000-strong UK workforce.
The luxury brand plans to save an extra £60million through the redundancies, including at its London head office and Castleford factory in Yorkshire where its trenchcoats are made.
Schulman said it had been hit by the UK's punitive tourist tax and Donald Trump's tariffs.
Changes under consultation include scrapping night shifts at Castleford and reducing the number of staff in shops.
It came as Burberry posted a £66million loss for the 12 months to March 29 after sales fell 12 per cent to £2.5billion amid a slump in China.
But this was not as bad as the City feared and Royal Bank of Canada analysts said the results were an 'encouraging first step' in a turnaround strategy.
Schulman, who took over last July, said: 'While we are operating against a difficult macroeconomic backdrop and are in the early stages of our turnaround, I am more optimistic than ever that Burberry's best days are ahead and we will deliver sustainable profitable growth.'
Shares jumped 17 per cent, or 140.8p, to 967.6p – up from 694p on April 3, but down from 2399.5p in April 2023.
The shares took a hammering after US President Trump announced tariffs last month. Their recovery accelerated this week after the US and China agreed to cut duties in a 90-day truce.
Schulman said sales in the US have been 'choppy' but that he was 'very confident' about American demand.
Burberry has been pinning its recovery hopes on more wealthy Americans splashing out on expensive clothes and accessories as demand from China falls.
Schulman pledged to return to 'timeless British luxury' by focusing on outerwear, including its £1,900 signature coats and £420 scarves.
He hailed the 'It's always Burberry weather' campaign – featuring Cara Delevingne and Rosie Huntington-Whiteley – for improving brand perceptions.
And he hit out at the tourist tax in the UK, which the Mail has called on the Government to scrap.
'We're operating in a challenging environment and clearly this has been exacerbated by decisions like the withdrawal of UK tax-free shopping,' he said.
The shares crashed to a 14-year low last September but Royal Bank of Canada said: 'We believe management are pursuing the right strategy to reset the business on a more level footing.'
Why shares are a buy
By Anne Ashworth
I'm with Joshua Schulman –shares in Burberry have further to run.
As the ex-boss of Coach, the American handbag business, Schulman knows how to cater to the tastes of the US moneyed classes.
The glossy look of model Rosie Huntington-Whiteley, who features in the Burberry campaign, is the vibe they like.
In March, I wrote that I was sticking with the shares. The price was 1036p; they sank to 674p in the tariff market rout but rose yesterday to 967.6p.
Expect more bid rumours. But a predator is more likely to emerge when Burberry's comeback is close to complete. And wouldn't we
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