LONDON (AFP) – British luxury fashion house Burberry yesterday announced sliding net profit during its first half as global demand for expensive clothing weakens, notably in China’s softening economy.
Profit after tax dropped 18 per cent to GBP158 million (USD196 million) in the six months to the end of September, the British group said in a statement.
“The slowdown in luxury demand globally is having an impact on current trading,” Burberry noted.
“If the weaker demand continues, we are unlikely to achieve our previously stated revenue guidance” for the group’s full year.
Reacting to the news, traders sent Burberry’s share price slumping 10.6 per cent to GBP15.61 in early deals, making it by far the biggest faller on London’s top-tier FTSE 100 index, which was down 0.1 per cent overall.
“Burberry’s sales growth slowed significantly in the second quarter, as trading conditions became much more challenging,” noted shares portfolio manager at investment firm Wealth Club Charlie Huggins.
