Burberry cuts profit targets due to projected decline in demand for luxury
Kyiv • UNN
Burberry cuts its profit forecast due to a drop in demand for luxury goods and a 7% decline in retail revenue. Operating profit at the end of the year is expected to decline.
London fashion giant Burberry said that the slowdown in demand for luxury goods intensified in December and as a result, the fashion house lowered its annual profit forecast. This is reported by the Independent, according to UNN.
Details
The company said that the trade was affected by a prolonged slowdown in demand for luxury goods following rising costs of living and higher interest rates around the world.
The company's CEO Jonathan Ackeroyd said that a further slowdown in the key December trading period would have a negative impact on the company's profitability. Burberry's shares have already fallen after the previous update in November, when the company warned that sales growth was lagging behind targets due to pressure on the luxury goods market.
On Friday, Burberry reported that retail revenues for the three months to December 30 fell 7% to 706 million pounds (about $900 million). Burberry told shareholders that the expected operating profit for the fiscal year ending in March will be about 460 million pounds (about $ 600 million).
The company also warned that it expects unfavorable foreign exchange rates to reduce its revenue and profit.
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