Burberry Fiscal Fabric Weathered By 40 Percent

Burberry’s fiscal fabric is bunching. The London-based fashion company just posted a significant drop — 40 percent — in its fiscal profits, further highlighting the challenge that luxury is facing.

Pretax profit showed £72 million (about $89 million) for the six months up to the end of September. That’s a gaping gap of £45 million compared to the £119.5 million last year. Costs did indeed cinch up because of the impending Brexit vote earlier this year.

The fact that luxury is out of fashion is nothing new. As PYMNTS reported, luxury brands’ sales growth is “so out” that experts say that the holiday season for high-end luxury will likely hit its lowest point in the past seven years.

Burberry’s executives, however, say that the company has a turnaround plan and is moving quickly on it.

At the same time, some experts are not quick to jump because about 20 percent of Burberry’s revenue comes from the U.S., which according to experts is anticipated to see a change in the dollar after Donald Trump’s election win.

One bright spot is that tourists are flocking to London, according to the Daily Mail, all in search of good deals with the British pound’s current level. And this ultimately may mean more transactions for Burberry.

As for the next-step plan for Burberry, the company says it will be cutting back on the number of products it offers by 15 to 20 percent this November — and over the next summer — in attempt to simplify and streamline the shopping experience. At the same time, the current plan has included expanding options to personalize and monogram products as a way to connect with millennials and keep up with trends that competitors like Louis Vuitton have embraced.