Apple has poached Angela Ahrendts, the long-standing and highly-paid boss of Burberry, to oversee the expansion of its retail empire, pushing shares in the luxury goods group lower as investors fretted over the surprise change of leadership.
Ahrendts, who has been at the helm of the British fashion brand since July 2006 and made £6.8 million last year, leaves next year to take up the new position of senior vice-president in charge of Apple’s retail and online stores, reporting to chief executive Tim Cook. She will be replaced by Christopher Bailey, who also retains his role as chief creative officer.
Shares in Burberry, which have risen by more than 40 per cent over the past year, slumped 7.6 per cent or 121p to close at 1,464p.
Analysts at Morgan Stanley said shareholders would be relieved that Bailey, who joined in 2001 and has been its creative chief for the past six years, was staying at Burberry, “but we anticipate some investor concern about combining the chief creative officer and CEO roles, which are both time consuming and require very different skill sets”.
However, chairman Sir John Peace insisted the change at the top was “a natural progression”, adding: “I have no doubt that Christopher’s vision and leadership, with the excellent management team in place, will keep Burberry on the forefront creatively, digitally and financially.”
Yorkshire-born Bailey said he was “profoundly moved and humbled” to be taking the reins of the company, best known for its distinctive checked patterns, and promised to “push the boundaries of design, technology and communication”.
The departure of Ahrendts leaves Carolyn McCall and Alison Cooper, the bosses of budget airline EasyJet and cigarette firm Imperial Tobacco respectively, as the only female chief executives in the FTSE 100. However, they could be joined by Royal Mail chief Moya Greene if the newly-privatised delivery service is admitted to the top-flight index at the next quarterly reshuffle in December.
US-born Ahrendts was executive vice-president at fashion house Liz Claiborne before joining Burberry and was previously president of fashion label Donna Karan International.
Her exit was announced as the group reported a 14 per cent rise in total revenues to £1 billion for the six months to 30 September, boosted by double-digit growth across the Asia Pacific and its Europe, Middle East, India and Africa regions, and “high single-digit” growth in the Americas.
Takings in mainland China were also up in the high single digits, despite fears of a slowdown in spending among well-heeled Chinese consumers, and the group said sales via Apple iPads in its stores also performed strongly.
Richard Hunter, head of equities at Hargreaves Lansdown, said the changes at the helm “will provide some caution in regards to continuity” but Burberry’s shares should retain their position as a “strong hold” among analysts.
Ahrendts will be looking to do better than the last chief of a British firm who upped sticks to join Apple – John Browett quit Dixons to lead the iPad and iPhone maker’s global retail expansion in 2012, but left after just six months.
She said: “I have always admired the innovation and impact Apple products and services have on people’s lives and hope in some small way I can help contribute to the company’s continued success and leadership.”
Apple chief executive Tim Cook said he was “thrilled” that Ahrendts would be joining the California-based tech giant in the spring.
He added: “She shares our values and our focus on innovation, and she places the same strong emphasis as we do on the customer experience. She has shown herself to be an extraordinary leader throughout her career and has a proven track record.”