UK luxury fashion brand Burberry may cut around 1,700 jobs globally as part of its Burberry Forward plan aimed at boosting profitability, agility and efficiency. The organisational changes, focused on streamlining operations, procurement, and real estate, are expected to deliver £100 million (~$125 million) in annual savings by FY27, including £60 million in new savings, while enhancing customer focus.
Meanwhile, the company, in its preliminary result for full fiscal year 2025 (FY25) ended March 29, reported a revenue decline of 17 per cent year-over-year (YoY) to £2.5 billion (~$3.1 billion), and 15 per cent at constant exchange rates (CER). The overall retail comparable sales were down 12 per cent, improving from a 20 per cent YoY decline in the first half (H1) to a 5 per cent drop in the second half (H2). The adjusted operating profit stood at £26 million, driven by a £67 million profit in H2 that offset a £41 million loss in H1.
However, the reported operating result showed a £3 million loss, impacted by £29 million in adjusting items. Gross margin fell to 62.5 per cent, down 470 basis points (bps) at CER and 520 bps at reported rates. Adjusted net operating expenses were reduced by 3 per cent at CER and 5 per cent at reported rates.
Following a challenging H1 FY25, the company launched its strategic plan, Burberry Forward, in November, focusing on resetting brand storytelling, enhancing visual merchandising both in-store and online, and aligning product emphasis with core categories. These actions led to a notable improvement in comparable retail sales in the second half, reinforcing confidence in the company’s strategic direction, Burberry said in its preliminary financial results.
Key actions taken in H2 FY25 included reasserting Burberry’s identity as a timeless British luxury brand through comprehensive campaigns like ‘It’s Always Burberry Weather’ and ‘Wrapped in Burberry’, and presenting the Winter 2025 runway show at Tate Britain.
The company has announced that it refined its product range with more focused, larger-scale offerings and pricing adjustments. Visual merchandising was enhanced with improved product displays and a pilot scarf bar concept. Online styling was updated, and digital innovations were introduced to boost engagement and appeal.
For FY26, Burberry acknowledges that it remains in the early stages of its turnaround, with the current macroeconomic environment becoming increasingly uncertain due to geopolitical developments.
Fibre2Fashion News Desk (SG)
