Burberry on Friday said it has closed a third of its shops in China and warned of further trouble ahead, as the British fashion giant grapples with the coronavirus outbreak.
The death toll from the virus has now topped 600, with the majority in mainland China. Burberry, which has a huge customer base there, is among the companies trying to limit staff exposure to the illness.
Marco Gobbetti, chief executive of trenchcoats maker Burberry, said the outbreak “is having a material negative effect on luxury demand”.
The firm expects full-year sales to March to be affected, and house broker Bank of America cut its comparable sales guidance for Burberry’s fourth quarter to 0% from 3%.
The shares fell 50.4p, or 2.5%, to 1966.7p.
The FTSE 100 firm said 24 of its 64 stores in mainland China are closed with remaining ones operating with reduced hours and seeing significant footfall declines. That is impacting sales there and in Hong Kong.
Burberry, which has suspended all business travel to and from mainland China, also cautioned that Chinese spending in Europe and other tourist destinations could be affected in coming weeks, amid widening travel restrictions.
Separately, shares in AIM-listed Novacyt surged 17%, or 6.9p, to 47.4p after the biotech company said one of its subsidiaries, Primerdesign, has seen huge demand for its test to detect the coronavirus strain involved in the recent outbreak.
Meanwhile Taiwanese electronics group Foxconn, which makes iPhones, is switching part of its production to making surgical masks.
