Burberry faces FTSE 100 relegation in fresh blow for beleaguered brand

Solemn: Iris Law is a Burberry ambassador

British label Burberry is set to be kicked out of the FTSE 100.

The troubled fashion firm’s share price has fallen and it faces eviction when the indicative shake-up is announced next week.

Known for its check print and trenchcoats, it has struggled with dire sales as a slowdown bites the luxury industry. Shares have fallen 50 per cent this year.

Now it looks likely the firm – now worth £2.5billion – will move into the FTSE 250. Provisional changes will be announced on Tuesday, with insurer Hiscox, worth more than £4billion, taking its place. Its shares have risen 21 per cent over the past year.

New Burberry boss Joshua Schulman already faces a daunting task.

Shares crashed to their lowest in 14 years last month when boss Jonathan Akeroyd left after just two years.

It hired the former Michael Kors and Jimmy Choo chief executive Schulman, and scrapped its dividend.

Affluent customers have reined back spending on high-end clothes, such as its trademark £1,900 trenchcoat, and accessories. Burberry has now been pinpointed as a takeover target.

There are also fears that private equity predators could swoop on the 168-year-old British firm.

Global index provider FTSE Russell states a stock will be kicked out if its market cap ranks 111 or below at the time of the shake-up. Any rising to 90th or above will be admitted. Burberry is 140th in the FTSE 350. The final changes are announced on September 4.

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