Burberry shares jump despite £80 million loss

Things are so bleak in fashion that Burberry’s half-year pre-tax loss of £80 million yesterday prompted a 17 per cent spike in its share price. The company’s revenue fell slightly less than analysts expected and came with a new turnaround plan focussing on trench coats and cutting back on bags and shoes for the vanishing Chinese luxury consumer. Fashion faces a crisis. Chanel lost its creative director, Virginie Viard, in June. Peter Hawkings left Tom Ford in July, while Hedi Slimane quit Celine and Kim Jones departed Fendi in October. Collapsing demand is hurting everyone. LVMH’s third-quarter revenue slumped despite the Paris Olympics. Even mass market brands like Asos and Boohoo are in the red. Takeovers loom. Frasers Group is after Boohoo and Moncler has just denied receiving a Burberry bid. Burberry’s CEO, Joshua Schulman, still has faith in China. “Never underestimate the power of the Chinese consumer,” he told analysts. Burberry is used to wars – its signature trench coat was designed for the Western Front – but its battle now is in the east.