Superdry counts cost of relying on weather
SUPERDRY felt the heat yesterday as it lost over a third of its market value due to warm weather hitting demand for its jackets and winter clothing.
Shares in the FTSE 250 fashion chain plunged 218¼p to 355¼p after November profits wilted by about £11million.
It expects a similar impact this month. Annual underlying profit is expected to be between £55million and £70million, compared with market forecasts of £83million.
It could close some stores and renegotiate rents on others as part of a drive to save at least £50million by 2022.
It also unveiled plans to expand into the global, annual $160billion (£126billion) childrenswear market next autumn/ winter.
Superdry is already under fire from cofounder and 18 per cent investor Julian Dunkerton for reducing the number of products and neglecting online growth.
Chairman Peter Bamford hit back, claiming Dunkerton’s views on strategy “have not evolved with the needs of what is now a multi-channel, international and increasingly digital retailer”.
Superdry’s underlying pre-tax profit in the six months to October 27 was down 49 per cent to £12.9million on 3.1 per cent higher revenue of £414.6million.
Since then, “unseasonably” warm weather continued through its two
biggest trading months. It said: “Given Superdry’s reliance on cold-weatherrelated products and a lack of innovation in some categories, sales have remained under pressure despite a strong performance in the Black Friday week.
“There is still considerable uncertainty in terms of the weather outlook, changing consumer behaviour in the peak trading period and [in] the impact of wider economic and political
uncertainty.” Chief Euan Sutherland insisted transformation begun in the spring would increase choice.
He added: “We are particularly excited by the launch of Superdry Kids. We are confident our transformation programme will deliver a return to higher levels of growth and profitability.”
Liberum analyst Wayne Brown said the results reaffirmed the need to rethink.