Amid challenging market conditions, Burberry has been demoted from the FTSE 100 index following a significant decline in share price.
- The company’s share price plummeted by 50.8% over the last six months, leading to its relegation to the FTSE 250 index.
- Burberry faced a 22% year-on-year revenue drop for the quarter ending 29 June, reflecting broader industry challenges.
- The transition in leadership saw Jonathan Akeroyd replaced by Joshua Schulman as CEO in an effort to steer the company forward.
- Burberry is set to release its interim results for the period ending 28 September 2024, which will provide further insights into its financial health.
Burberry, the renowned British luxury brand, has officially been demoted from the prestigious FTSE 100 index. This development comes as part of the FTSE Russell’s latest quarterly review, which saw the inclusion of Burberry into the midcap FTSE 250 index. The demotion is largely attributed to a sharp fall in the company’s share price, which has declined by 50.8% over the past six months, and by 71.5% over the past year, bringing the stock down to 623p as of 4 September. The significant decrease in share value highlights the financial challenges that Burberry has been grappling with amid a slowing demand in the luxury sector.
The revenue figures for Burberry have further underscored the challenging business environment the company is facing. For the 13 weeks ending 29 June, the brand reported a 22% year-on-year slump in revenue to £458 million. This downturn follows a 4% decrease in revenue to £2.97 billion and a substantial 34% drop in operating profit to £418 million for the entirety of the year ending 30 March. These figures paint a vivid picture of the pressures weighing down Burberry’s financial performance.
Jonathan Akeroyd, the former CEO of Burberry, articulated the difficulties faced by the company, particularly in executing strategic plans amidst a declining luxury market. “Executing our plan against a backdrop of slowing luxury demand has been challenging,” he conceded in May. His subsequent departure made way for Joshua Schulman, who took over leadership in July to navigate these turbulent waters.
Market watchers and stakeholders eagerly anticipate Burberry’s forthcoming interim results, scheduled for release on 14 November 2024. These results, covering the 26 weeks up to 28 September 2024, are expected to deliver deeper insights into Burberry’s strategic adjustments and fiscal health. Investors and analysts alike are poised to gauge how the company intends to counteract current adversities and realign its growth trajectory.
Burberry’s relegation from the FTSE 100 marks a critical juncture for the brand, underscoring the need for strategic realignment in response to market headwinds.
