Burberry (Bo Baili) Announced That It Will Reduce Its Annual Performance Expectations For The Fiscal Year.

As the previous financial year did not take into account the impact of the new crown virus epidemic on the luxury market, the British luxury brand Burberry (Bo Baili) updated it in February 7th. Although no specific details and figures are available, Burberry is likely to cut its full year forecast for fiscal year 2020.

Prior to January 22nd, Burberry reported its third quarter earnings for the 2019/2020 fiscal year, and expects that net sales in the fiscal year will achieve low single digit growth.

Marco Gobbetti, chief executive of Burberry, said: "the outbreak of a new crown virus in mainland China has had a significant negative impact on the luxury market." Chinese consumers are one of the most important customer groups of Burberry, and nearly 40% of its sales are from Chinese consumers. According to the quarterly earnings data, the sales volume of Burberry Asia Pacific market has increased by a small number of units, driven by the strong double-digit growth in sales in mainland China.

At present, Burberry has 64 stores in mainland China, of which 24 have been temporarily closed, and other stores have shortened their business hours and the volume of passenger traffic has dropped significantly. Meanwhile, sales of Burberry in China's Hongkong market have dropped sharply: in the last quarter, sales of Burberry in Hongkong, China, fell by nearly 50% due to the social turbulence.

In addition, the epidemic will also affect Burberry's business in Europe and other tourist destinations. Burberry said that in view of the increasing travel restrictions, the impact of Europe and other places is expected to intensify in the coming weeks.

Burberry said that as the 2019/2020 quarter approached the fourth quarter of the fiscal year, the group, despite its mitigation measures, had limited effect on the fiscal year. However, Burberry said it will continue to implement the group growth plan to prepare for the recovery of luxury demand in the future.

Marco Gobbetti also said, "although we can not predict when the epidemic will end, we still have confidence in the group's strategy. At the same time, we are taking relevant measures to ensure the health of our employees. We want to thank the team for their efforts, which we are directly affected by the epidemic.

As of February 7th closing, Burberry shares fell 3.46% to 20.15 pounds per share.