Burberry Restructures In Spain
Luxury goods group Burberry (made more famous by Chavs!) will restructure its loss-making operations in Spain, ceasing the production of exclusive collections and closing a facility that will likely mean 300 job losses.
The firm said on Wednesday that with Spain enduring a prolonged economic downturn it was no longer viable to design and sell collections exclusively for the Spanish market.
Burberry said it will cease production of a local collection in Spain after autumn/winter 2010, closing a facility in Barcelona.
The firm will introduce its global collection with effect from spring/summer 2011 across all channels in Spain — directly operated stores, concessions and wholesale.
It will take a one-off charge associated with the restructuring of 50-70 million euros.
Burberry said losses are now expected in Spain in the 2009/10 year and beyond. However, it said group profit before tax for 2009/10 remains in line with expectations.
Last month Burberry smashed third-quarter sales forecasts and predicted annual profit towards the (then) top end of expectations.
Shares in Burberry were up 1.5 percent at 628 pence at 9:21 a.m., valuing the business at 2.73 billion pounds.
(Reporting by James Davey, editing by Mark Potter)
