Burberry Is Still Not Out Of The Mire Of Achievement.

As global consumers increasingly pursue freshness, British brands

It still seems to be out of the mire of achievement.

According to the world clothing and shoe net, in the three months ended December 31st, Burberry (LON:BRBY) retail sales fell 2% to 719 million pounds compared with the same period last year, and increased by 1% according to the real time exchange rate, far less than the 22% increase in the same period last year. The same store sales growth rate was 2%, lower than that of last year's 3%, which was not as expected as analysts.

Among them, Burberry

Sales performance of these products is most significant, mainly due to consumers' positive pursuit of new products.

Chief executive Marco Gobbetti previously proposed to return.

The strategy also provides consumers with more high-end and personalized service experience.

During the period, driven by the achievements of the mainland of China, sales in the Asia Pacific region registered a median growth rate, especially in the face of consumer digital business. Burberry's sales in the EMEIA area recorded a low single digit decline, and sales in the US region were roughly the same as last year's.

As of December 31, 2017, Burberry has 205 retail outlets, 199 franchise stores, 57 outlets and 47 franchise stores worldwide.

As for the decline in sales, Burberry explained in its earnings report that most of the wealthy consumers chose to travel outside the UK during the holidays and buy other high-end products.

Marco Gobbetti said its high-end brand strategy advanced last year is making good progress and is expected to achieve its profit target in the 2017 fiscal year.

The picture is Burberry CEO Marco Gobbetti and the outgoing creative director Christopher Bailey.

In November last year, Marco Gobbetti resolved to reform its brand in the first half of Burberry.

He stressed that despite its efforts in recent years, Burberry has gradually gained a firm foothold in the global industry, but it is still in a passive position in the industry. The future brand will focus on high-end products, which means that the group will begin to cut down non commodity sectors and businesses.

While focusing on the product area, Marco Gobbetti also stressed that the group will speed up the cost reduction plan previously proposed by former CEO Christopher Bailey, which aims to save 120 million pounds a year by 2020.

The savings will be invested in the pformation of physical stores and digital experience.

However, this strategic investor of Marco Gobetti did not buy it. Burberry shares fell 13% on the same day and recorded a five year decline.

Another analysis is that Marco Gobbetti is more eager to find a new creative director for the brand. Burberry's current creative director, Christopher Bailey, will withdraw from the Burberry board in March 31st.

Due to the delay in the emergence of new core products, Burberry is fading away from the pursuit of fresh young consumers.

In a report released last May by UBS UBS, the price of Burberry handbags was about 14% lower than that of handbags of the same kind. It is believed that Burberry still has room to raise prices in this category.

Wu Yifan has a strong appeal for young people in China. Burberry declared him a global spokesman in 2016.

The picture is Burberry x Kris Wu series.

In view of the high dependence of Burberry on Chinese consumers and the stimulation of sales growth in the region, the group also launched 19 cooperative products with spokesperson Wu Yifan last year.

However, some analysts emphasize that the final product that consumers still pay is the product itself. Burberry should start to be alert to products that are not attractive to the brand.

In 2018, Burberry planned to reduce its operating cost by 60 million, which would be inconvenient for annual operating profit and revenue expectations.

Marco Gobbetti said its goal is to reverse the declining trend of Burberry growth. After implementing its plan, Burberry's revenue and operating profit growth will remain at the high single digit level within 5 years.

Obviously, Burberry is still in turmoil amid performance and internal high-level.

Now people in the industry are constantly wondering whether Burberry is once again caught in the whirlpool of acquisitions.

The 91 year old Belgian billionaire Albert Frere, after announcing the new strategy of Marco Gobbetti, increased its Burberry holdings from 4% to 6%, which is Albert Frere's second increase in Burberry shares in the past year.

It is noteworthy that Albert Frere is an independent director of LVMH group.

Analysts believe that after Albert Frere shares Burberry, it will implement a series of reform measures to enhance the brand profits, which is in line with the reform strategy announced by Marco Gobetti after the earnings announcement. It is the key reason for Albert Frere's holdings.

As for the changing status of Burberry, there are concerns about whether Burberry will become another Mulberry.

However, Berenberg analysts say that Albert Frere's holdings of shares are positive, or will become a catalyst for Burberry to regain investor confidence.

Due to continued decline in performance, Burberry has been reported to be a potential target for many years.

In 2013, analysts and investment banking analysts said that LVMH had considered buying Burberry. In 2014, a list of European potential acquired company presented by UBS analysts was listed by Burberry.

After the release of the earnings report, Burberry opened its stock price on the same day and plunged 7.11% to 16.6 per share, with a market value of about 7 billion 40 million pounds.

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