Burberry replaces CEO after 'disappointing' results
British fashion label Burberry announced the immediate departure of chief executive Jonathan Akeroyd as it posted "disappointing" results with the luxury sector pressured by weak Chinese demand.
Akeroyd, 57, departs after less than two and a half years at the helm, while the Briton is being replaced by Joshua Schulman, a former CEO at American fashion brands Michael Kors and Coach.
In a statement, Burberry chair Gerry Murphy described US national Schulman, 52, as "a proven leader with an outstanding record of building global luxury brands and driving profitable growth."
Schulman, who officially joins the group on Wednesday, said he looked "forward to working alongside (creative director) Daniel Lee and the talented teams to drive global growth, delight our customers, and write the next chapter of the Burberrystory."
In a separate statement, Murphy said the group's recent "performance is disappointing."
Revenue slid 22% to £458 million (almost P35 billion) in Burberry's first quarter, or three months to the end of June.
The 168-year-old label—famous for its trench coats and trademark red, camel and black check design—announced plans to cut costs, which involve suspending dividend payments.
Murphy warned that the group risked an operating loss in its first half.
Shares slump
Burberry's share price slumped 14.5% to £7.57 (P573) following the announcements, making it by far the largest faller on London's top-tier FTSE 100 index, which was flat overall in morning trade.
"Burberry grabbed the headlines in company news, bringing forward its first quarter update amid some developments which came as a shock," noted Richard Hunter, head of markets at Interactive Investor.
"The level of the group's appeal has been thwarted by weakening consumer demand, especially in the likes of China."
Burberry's share price is down 46% since the start of the year.
Highlighting troubles across the luxury fashion sector, Gucci owner Kering in April issued a profit warning, citing a weak Chinese economy.
China on Monday posted lower-than-expected growth of 4.7% in the second quarter.
That represented the slowest rate of expansion since early 2023, when China was emerging from a crippling zero-Covid policy that strangled growth.
Retail sales—a key gauge of consumption—rose just two percent in June, down from 3.7% growth in May.
"Chinese sales can no longer be taken for granted" for the likes of Burberry, Chris Beauchamp, chief market analyst at online trading platform IG, said. (AFP)