Burberry shares plummet on profit warning

Burberry shares plunged by almost 19 per cent in early trading as the fashion retailer cut its profit forecast for the full year.

The group, which has been hit by falling sales in China, said like-for-like sales were unchanged year on year, with sales dropping off in recent weeks.

The FTSE 100 company, whose trademark is the distinctive red, camel and black check pattern, added that adjusted pre-tax profit for the 12 months to 31 March next year would be “around the lower end of market expectations”.

In July, Burberry reported a slowdown in first-quarter sales in China, a market which has been one of the main drivers of a boom in luxury brands, with consumers eager to buy designer labels, including Burberry's raincoats and other high-end fashions.

Chief executive Angela Ahrendts said Burberry would be “tightly managing discretionary costs” and take actions to protect short-term profits.

Shares were hovering around the 257p mark in early trading.