Burberry announces inaugural medium-term Sustainability Bond

Burberry Group plc has announced its intention to issue a benchmark-sized, medium-dated, sterling public Sustainability Bond.

This will be the first sustainability labelled bond issued by a luxury company, intended to diversify Burberry’s sources of funding, introducing long-term financing into the Company’s capital structure.

Burberry has applied to be rated by Moody’s and expects the Bond to be rated Baa2 (Stable Outlook).

The Bond will be issued pursuant to the Company’s Sustainability Bond Framework, which has received a ‘second party opinion’ from Sustainalytics.

The Company has a conservative capital allocation policy and already holds substantial liquidity. Following the outbreak of COVID-19, earlier in the year the Company drew down its £300 million Revolving Credit Facility and issued £300 million of short-dated commercial paper under the Bank of England’s Covid Commercial Financing Facility, with a maturity in March 2021.

The RCF drawings were repaid in full in the first quarter of FY 2020/21.

The Bond will be offered to professional investors and eligible counterparties. Applications will be made for the admission of the Bond to be listed on the Official List of the UK Listing Authority and to be traded on the Main Market of the London Stock Exchange.

Earlier today Burberry announced it is to launch a series of worldwide pop-ups to celebrate some of its signature bags and accessories, as well as launching itself into gaming via Snapchat.