2023 has been anything but a vintage year for investors in Burberry (BRBY), with the shares losing 23% year-to-date as sales succumb to the global economic slowdown.

The firm’s fall from grace shows that even luxury fashion houses aren’t immune from seeing their customers cut back on spending.

Demand in China has more or less evaporated after an initial post-pandemic bounce, with Asia-Pacific revenue up just 2% in the six months to 30 September, and sales in the Americas are down 10% compared with a year ago.

Russell Pointon, director of consumer at investment research and consultancy firm Edison, commented: ‘The more challenging macroeconomic environment has taken its toll on management’s guidance for full year 2024, with prior revenue guidance unlikely to be met and guidance for adjusted operating profit moving to the lower end of consensus expectations despite a reduced currency headwind now being predicted.’

There were a few glimmers of hope for shareholders, however, as the group completed its £400 million share buyback and increased its first half dividend by 11% to 18.3p per share.

Shareholders in Burberry and other luxury goods firms will need to wait and see whether demand picks up next year or whether even their well-heeled clientele continue to rein in spending.

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