Britain's Burberry says the drop in the value of the pound after the Brexit vote could boost its bottom line by 90 million pounds this year. But as Hayley Plat reports its struggling to counter weak demand for luxury goods.
It's a retail destination for many tourists. But the Paris attacks and the downturn in China has meant fewer of those. Combine that with a more cautious consumer environment and Burberry is finding sales harder to find. Like-for-like they fell in the first quarter by 3 percent to 423 million pounds. (SOUNDBITE) (English) CHIEF ECONOMIC ADVISER, CEBR, VICKY PRYCE, SAYING: "What has happened with other firms that are not perhaps in the luxury market is that they've done reasonably well by just cutting prices and then when things improve you go back to where you were before. I would be very surprised if we don't see something like that in the luxury market too." But revenue from new stores has helped, so could the fall in the value of the pound after the Brexit vote. At current levels Burberry expects a 90 million pound boost to annual profits It all means there are tough challenges ahead for the new CEO. Italian Marco Gobbetti will join Burberry from French brand Celine next year leaving Christopher Bailey to concentrate on being creative director and President. Investors liked that annoucenment on Monday. Shares rose to a 12 week high, although they're still down by around a quarter from a year ago.