Latest news with #BurberryGroupPlc
Yahoo
15-05-2025
- Business
- Yahoo
Burberry Sheds Jobs, Handbag Bling as CEO Returns to Roots
(Bloomberg) -- Burberry's new boss is calling time on the British fashion label's decade-long attempt to join the upper ranks of global luxury. As Coastline Erodes, One California City Considers 'Retreat Now' How a Highway Became San Francisco's Newest Park Power-Hungry Data Centers Are Warming Homes in the Nordics A New Central Park Amenity, Tailored to Its East Harlem Neighbors Maryland's Credit Rating Gets Downgraded as Governor Blames Trump Joshua Schulman, the straight-talking chief executive officer who took over in July, said Wednesday Burberry Group Plc will slash up to 1,700 roles — about a fifth of its workforce — amid a historic slump in sales. But he also took aim at decisions made by his predecessors, saying the company moved too far from its trench-coat roots with its foray into niche designs and expensive handbags. 'The juice wasn't worth the squeeze on that,' Schulman told analysts. 'We had a runway brand expression that was unfamiliar and did not resonate.' Burberry's fall from grace has been brutal, with sales for the last 12 months slumping to the lowest since 2014, amid weak global demand for high-end goods and more recent concerns about President Donald Trump's trade tariffs. Schulman, though, is looking back further for what he wants to fix. Over the past decade Burberry has cycled through three CEOs, three creative designers, a mocked monogram and a mish-mash of efforts to 'elevate' the brand. For a while it appeared to work — at least in terms of Burberry's stock price, which peaked in 2023 as fashion labels enjoyed a post-pandemic boom of pent up spending. Yet Burberry has very little to show for a decade of effort, with lackluster revenue, falling profit and its ouster from the UK's benchmark FTSE 100 index last year. Even after a surge on Wednesday, the shares are down more than 60% from their post-pandemic high. Cutting costs is at the heart of Schulman's plan to fix Burberry. The CEO, who previously ran Coach and Michael Kors, said the job losses will be primarily office-based roles including at its headquarters near London's iconic Big Ben landmark, although there will be some cuts elsewhere. Even Castleford, Burberry's spiritual home in northern England where its signature trench coats are made, has not been spared: night shifts will be scrapped to reduce over-production and to help eke out a further £60 million ($80 million) of savings over the next two years, on top of the £40 million already planned. Schulman also said Burberry would refocus on outerwear, be it trench coats, scarves or even bikinis. The company is also betting that its traditional check trims on polo shirts and dresses will drive sales throughout the year. Investors, whose dividend payments remain suspended, sent Burberry's shares up 17% at the close on Wednesday. 'The old saying is never let a good crisis go to waste. Schulman is showing he understands that well,' said Cole Smead, a portfolio manager at Smead Capital Management. 'We think we are being given a unique brand on the cheap.' Still, while Burberry's latest results were better than analysts expected, Schulman and Chief Financial Officer Kate Ferry warned of uncertainty around tariffs in the US, which accounts for 19% of the company's sales and where they said trading was particularly choppy starting from February. The problem is compounded by the slowdown in Asia Pacific, which generates almost half of Burberry's sales. 'It has been unusual for both America and China to be struggling at a similar time,' Schulman said. 'The history of luxury is that China and America have acted as a hedge to each other.' The CEO described his radical restructuring plan as difficult but necessary given Burberry's challenges. Ending the night shift at the Castleford will put 170 jobs at risk, about a third of the facility's workforce, according to Darran Travis, the GMB union representative for the workers at the plant. 'We accept we haven't been in good times, with too much production and falling sales, so we'll work with Burberry,' Travis said by phone Thursday. 'We're in a deprived area, a former coal-mining area, it's an area in serious decline.' The other part of Schulman's strategy, to pull company back closer to its heritage, ends a gamble on high fashion that ultimately flopped. 'Either the circumstance have crafted his decisions or he has the wisdom to make these changes that seem pragmatic,' Smead said of Schulman's moves. 'Time will tell, but our investors are betting on the latter.' --With assistance from Kit Rees. (Updates with labor union representative's comment four paragraphs from bottom.) Cartoon Network's Last Gasp DeepSeek's 'Tech Madman' Founder Is Threatening US Dominance in AI Race Why Obesity Drugs Are Getting Cheaper — and Also More Expensive As Nuclear Power Makes a Comeback, South Korea Emerges a Winner Trump Has Already Ruined Christmas ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
15-05-2025
- Business
- Yahoo
Burberry Sheds Jobs, Handbag Bling as CEO Returns to Roots
(Bloomberg) -- Burberry's new boss is calling time on the British fashion label's decade-long attempt to join the upper ranks of global luxury. As Coastline Erodes, One California City Considers 'Retreat Now' How a Highway Became San Francisco's Newest Park Power-Hungry Data Centers Are Warming Homes in the Nordics A New Central Park Amenity, Tailored to Its East Harlem Neighbors Maryland's Credit Rating Gets Downgraded as Governor Blames Trump Joshua Schulman, the straight-talking chief executive officer who took over in July, said Wednesday Burberry Group Plc will slash up to 1,700 roles — about a fifth of its workforce — amid a historic slump in sales. But he also took aim at decisions made by his predecessors, saying the company moved too far from its trench-coat roots with its foray into niche designs and expensive handbags. 'The juice wasn't worth the squeeze on that,' Schulman told analysts. 'We had a runway brand expression that was unfamiliar and did not resonate.' Burberry's fall from grace has been brutal, with sales for the last 12 months slumping to the lowest since 2014, amid weak global demand for high-end goods and more recent concerns about President Donald Trump's trade tariffs. Schulman, though, is looking back further for what he wants to fix. Over the past decade Burberry has cycled through three CEOs, three creative designers, a mocked monogram and a mish-mash of efforts to 'elevate' the brand. For a while it appeared to work — at least in terms of Burberry's stock price, which peaked in 2023 as fashion labels enjoyed a post-pandemic boom of pent up spending. Yet Burberry has very little to show for a decade of effort, with lackluster revenue, falling profit and its ouster from the UK's benchmark FTSE 100 index last year. Even after a surge on Wednesday, the shares are down more than 60% from their post-pandemic high. Cutting costs is at the heart of Schulman's plan to fix Burberry. The CEO, who previously ran Coach and Michael Kors, said the job losses will be primarily office-based roles including at its headquarters near London's iconic Big Ben landmark, although there will be some cuts elsewhere. Even Castleford, Burberry's spiritual home in northern England where its signature trench coats are made, has not been spared: night shifts will be scrapped to reduce over-production and to help eke out a further £60 million ($80 million) of savings over the next two years, on top of the £40 million already planned. Schulman also said Burberry would refocus on outerwear, be it trench coats, scarves or even bikinis. The company is also betting that its traditional check trims on polo shirts and dresses will drive sales throughout the year. Investors, whose dividend payments remain suspended, sent Burberry's shares up 17% at the close on Wednesday. 'The old saying is never let a good crisis go to waste. Schulman is showing he understands that well,' said Cole Smead, a portfolio manager at Smead Capital Management. 'We think we are being given a unique brand on the cheap.' Still, while Burberry's latest results were better than analysts expected, Schulman and Chief Financial Officer Kate Ferry warned of uncertainty around tariffs in the US, which accounts for 19% of the company's sales and where they said trading was particularly choppy starting from February. The problem is compounded by the slowdown in Asia Pacific, which generates almost half of Burberry's sales. 'It has been unusual for both America and China to be struggling at a similar time,' Schulman said. 'The history of luxury is that China and America have acted as a hedge to each other.' The CEO described his radical restructuring plan as difficult but necessary given Burberry's challenges. Ending the night shift at the Castleford will put 170 jobs at risk, about a third of the facility's workforce, according to Darran Travis, the GMB union representative for the workers at the plant. 'We accept we haven't been in good times, with too much production and falling sales, so we'll work with Burberry,' Travis said by phone Thursday. 'We're in a deprived area, a former coal-mining area, it's an area in serious decline.' The other part of Schulman's strategy, to pull company back closer to its heritage, ends a gamble on high fashion that ultimately flopped. 'Either the circumstance have crafted his decisions or he has the wisdom to make these changes that seem pragmatic,' Smead said of Schulman's moves. 'Time will tell, but our investors are betting on the latter.' --With assistance from Kit Rees. (Updates with labor union representative's comment four paragraphs from bottom.) Cartoon Network's Last Gasp DeepSeek's 'Tech Madman' Founder Is Threatening US Dominance in AI Race Why Obesity Drugs Are Getting Cheaper — and Also More Expensive As Nuclear Power Makes a Comeback, South Korea Emerges a Winner Trump Has Already Ruined Christmas ©2025 Bloomberg L.P.
Bloomberg
15-05-2025
- Business
- Bloomberg
European Stocks Snap Four-Day Winning Streak; Alstom Slides
European stocks fell for the first time in five sessions as traders paused for breath after a rally spurred by trade optimism. Alstom SA slumped 17% as softer guidance overshadowed solid earnings. The Stoxx Europe 600 Index dropped 0.2% by the close. Consumer products and health care stocks lagged while banks and construction shares outperformed. Burberry Group Plc jumped 17% after reporting better-than-expected retail sales in the fourth quarter and announcing job cuts.
Bloomberg
15-05-2025
- Business
- Bloomberg
Burberry Sheds Jobs, Handbag Bling as CEO Seeks Return to Roots
Burberry's new boss is calling time on the British fashion label's decade-long attempt to join the upper ranks of global luxury. Joshua Schulman, the straight-talking chief executive officer who took over in July, said Wednesday Burberry Group Plc will slash up to 1,700 roles — about a fifth of its workforce — amid a historic slump in sales. But he also took aim at decisions made by his predecessors, saying the company moved too far from its trench-coat roots with its foray into niche designs and expensive handbags.
Business Mayor
14-05-2025
- Business
- Business Mayor
Embattled Burberry to cut 1,700 jobs amid turnaround
An Equestrian Knight Device logo on a flag outside the Burberry Group Plc luxury boutique in London, UK, on Tuesday, May 13, 2025. Bloomberg | Getty Images Burberry on Wednesday announced a slew of organizational changes, amid continued turnaround efforts at the embattled luxury house. The company said the measures could lead to a 'reduction in people-related costs which could impact around 1,700 roles globally' over the lifetime of the program, set to complete in 2027. The moves — which include cost cutting across procurement and real estate — are estimated to lead to cost savings of £60 million ($79.9 million) and mark the latest phase of CEO Joshua Schulman's strategy to improve revive the fortunes of the heritage British brand. It follows £40 million in cost cutting measures announced in November, taking totaled estimated cost savings to £100 million. The job cuts will impact around 20% of Burberry's overall headcount, with the majority set to take place in office-based roles, as well as within stores and at its factory in Castleford, England. Shares jumped 8.5% shortly after market open in London. Burberry sales fell slightly less than expected in the fiscal fourth quarter, down 6% in the three months to March. Analysts had anticipated a 7% decline in a company-compiled consensus estimate. For the fiscal year, sales were down 12% versus an anticipated 13% decline. Total revenue for the year was £2.461 billion ($3.273 billion), slightly ahead of an estimated £2.451 billion. Sales fell across all regions over the year and the quarter, led by weakness in Asia-Pacific. Sales in the Americas — which had been a bright spot of positive performance in the third quarter — swung to a 4% loss in the three months to end the fiscal year. Burberry had previously flagged the U.S. as a bright spot in third-quarter sales. However, the fashion house said Wednesday that 'current macroeconomic environment has become more uncertain in light of geopolitical developments.' 'While we are operating against a difficult macroeconomic backdrop and are still in the early stages of our turnaround, I am more optimistic than ever that Burberry's best days are ahead and that we will deliver sustainable profitable growth over time,' Schulman said in a statement. The company did not provide specific guidance on the estimated impact of U.S. tariffs. It flagged an 'increase in geopolitical tension which leads to incremental unmitigated tariff risks compared to the central planning scenario' as a key downside risk. Burberry Chief Financial Officer Kate Ferry said the tariff impact was currently 'very dynamic' and that the company would not be drawn on exact figures. 'We are a well diversified business. The U.S. is really important but it is 19% of our business. Wherever tariffs end up, we'll be able to respond,' Ferry said during an earnings call on Wednesday. Schulman in November announced urgent plans to 'course correct' after a prolonged period of underperformance for the company amid waning sales and a slew of management changes. The strategic overhaul marks the latest iteration of the 169-year-old retailer. Schulman joined in July from Michael Kors, becoming the brand's fourth CEO in the last decade. This is a developing story. Please check back for updates.
