14 November 2024
If you are covering Burberry's Q2 trading update, please see the following comment from Mamta Valechha, consumer discretionary analyst at Quilter Cheviot:
"Burberry posted better than expected results in its Q2 trading update this morning. However, its like for like sales remain subdued at -20%. Burberry’s operating margins were also a touch better than had been anticipated, but the business continues to be making an overall loss with its operating margin now at -3.8%.
"The company’s mixed bag of results reflect what is still a very tough backdrop. Burberry’s tilt towards aspirational consumers is being increasingly challenged as their wallets are being stretched, and the group’s unsuccessful attempt to ‘premiumise’ the brand has done little to help either. As is the case with many other luxury players, Asia remains a particular weak spot for Burberry, while Europe and the US are gradually showing signs of improvement, albeit from a low base.
"All eyes will now be on Burberry’s new CEO, Josh Schulman, who will be presenting later this morning. His strategy geared towards making the brand desirable will be under close scrutiny, but with hope it could present a turning point in what has been a very difficult period."
