New Burberry chief faces challenges as sales fall

Burberry has reported a decline in like-for-like sales and a "challenging retail environment", shortly after announcing a management reshuffle which sees current boss Christopher Bailey step back.

Burberry: sales down again in a challenging market for luxury
Burberry: sales down again in a challenging market for luxury

Earlier this week, Burberry announced that Celine's chairman and chief executive Marco Gobbetti would be taking the top job in 2017, replacing Bailey.

Bailey will retain his role as chief creative officer and take on additional duties as president.

In a first quarter trading update for the three months to 30 June, Burberry reported a 3% decline in like-for-like sales, with flat underlying revenue of £423m. The UK saw "mid-single digit percentage" growth. 

The brand suffered double-digit declines in Hong Kong while mainland China sales remained broadly unchanged year on year.

Digital was a bright spot for the brand, with mobile past a tipping point and delivering the majority of growth. Almost 60% of traffic to Burberry's site came via a mobile device, the company said.

Bailey said: "In what remained a challenging external environment, underlying retail sales were flat in the first quarter.

"In this context, we continue to focus on managing our business with agility whilst implementing the ambitious evolution of our strategies and ways of working we outlined in May, to position Burberry for long-term growth."

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