Fashion forward
Dunkerton secures key £70m loan to help Superdry through sales slump
COMEBACK boss Julian Dunkerton’s turnaround of battered Superdry was handed a much-needed boost today, as the fashion brand secured a key £70 million loan amid a Covid sales slump.
The retailer said it had agreed a new facility with existing lenders HSBC and BNP Paribas until January 2023 — replacing one due to expire a year earlier — that “together with our strong net cash position, gives us the necessary flexibility and liquidity going forward”. The company has £57.8 million of cash on the balance sheet.
The move will allay fears of a cash squeeze at the brand, where Dunkerton is investing in revamping its stores and ranges to arrest its decline.
Fresh trading figures today laid bare the scale of his task, as revenues fell 24.1% on last year in the 13 weeks to July 25. Store revenues plunged 58.1% with shops forced to close in lockdown until June 15 while its wholesale arm also took a knock, down 31%, as its franchisees suffered.
However, digital sales surged 93.2% in the first quarter when Britons shopped for casual fashion online in lockdown. The firm said growth rates were “normalising” in recent weeks as shops had re-opened and it came up against tough comparisons last year.
Investors and brokers took heart from the update. The shares — which have crashed from a peak of 2074p in 2018 — rose 20p or 17% to 138p today.
In a Buy note, Liberum analyst Wayne Brown said store trading was better than feared, adding: “There is significant recovery opportunity ahead with Autumn/Winter20 where new product and ranges not only look very promising but could provide a step-change in trading performance across the group.”
Dunkerton, Superdry’s founder and biggest shareholder, forced his way back on to the board last year after waging a bitter war with ousted former boss Euan Sutherland over his strategy.