FILE PHOTO: People queue outside a Burberry store on Regent Street, London, Britain September 17, 2018. REUTERS/Henry Nicholls
LONDON (Reuters) – Britain’s Burberry said the luxury industry could take some time to recover from the COVID-19 pandemic as it reported a 27% drop in comparable sales in the final quarter of its year, which ended with about 60% of its retail stores closed.
The company said given the uncertain outlook it had pulled its final dividend and would review future payouts at the end of its 2021 financial year.
Burberry, like other high-end fashion labels, saw the early impact of the coronavirus crisis in late January when sales in China, one of its most important markets, started to fall sharply.
As the pandemic spread to Europe and North America, it said it suffered very significant losses in March in those regions, with all of its stores there closed by the end of the year.
Chief Executive Marco Gobbetti said Burberry was making strong progress in its strategy to reposition the brand, with sales growing ahead of expectations, prior to the coronavirus.
“Since then, the global health emergency has had a profound impact on the world, our industry and Burberry but I am very proud of the way we have responded,” he said on Friday.
“It will take time to heal but we are encouraged by our strong rebound in some parts of Asia and are well-prepared to navigate through this period.”
Burberry reported full-year revenue of 2.63 billion pounds, down 3%, and pro-forma adjusted operating profit of 404 million pounds, down 8% at constant exchange rates, for the year to March 28.
Reporting by Paul Sandle; editing by Costas Pitas and Michael Holden