Superdry chief’s in upbeat mood despite testing times
FASHION retailer Superdry has issued another profits warning, stating “trading performance continues to be weak.”
The company said pre-tax profits for the year would be lower than expectations, partly due to weak wholesale and online sales in the 13-week period of Quarter 4.
The company has lost more than 70 per cent in its share value since January 2018 and recently announced plans to cut up to 200 jobs, mostly from their Cheltenham headquarters.
It comes just over a month since Julian Dunkerton, inset, received 51.15 per cent of shareholders votes to be reappointed to the Board, along with former Boohoo chairman Peter Williams.
Hours after a vote by the Superdry board to reinstate the Cheltenham businessman, four of his main opponents, including chief executive Euan Sutherland, stepped down with immediate effect. A further four more gave three months notice to quit.
Despite the profits warning, Mr Dunkerton remains optimistic, saying he was “very excited about being back in the business” and his “first priority has been to stabilise the situation.”
Group revenue remained flat yearon-year, but declined 4.5 per cent in
Quarter 4. Superdry said this was due to ‘poor wholesale and Ecommerce performance’ but that ‘actions to address this under-performance are underway.’
A comprehensive programme to deliver £50 million gross cost savings by the financial year 2022 will continue.
Global Brand revenue increased 3.6 per cent from the previous year, to £1,736.1m.
However, the trading performance statement shows declines in a number of areas in Quarter 4 of 2019. Wholesale revenue grew 3.6 per cent in the full year, but decreased 9.3 per cent in the final Quarter. Additionally, Ecommerce increased 1.6 per cent, but fell 3.9 per cent in Quarter 4. Store revenue decreased 3.7 per cent, compared to the 2018 financial year - down from £387m to £373m.
The board believe underlying profit before tax forecasts between £54.1m to £59.4m.
Interim chief executive Julian Dunkerton said: “I am very excited about being back in the business. There’s a lot to do, but after five weeks, I am more confident than ever we can restore Superdry to being the design-led business with strong brand identity I know it can be. My first priority has been to stabilise the situation, and all of us in the business are putting all our energy into getting the product ranges right and improving the Ecommerce proposition, which are two important steps towards addressing Superdry’s recent weak performance. “The impact of the changes we are making will take time to come through in the numbers but I’m confident we are heading in the right direction.” Chairman Peter Williams said: “I’m delighted to have joined Superdry. “This is a fantastic British brand, and I firmly believe that with the plans Julian is putting in place it will be a great success story once again. Today’s statement shows the scale of the challenge ahead of us.
“The company’s financial performance won’t be turned around overnight, but we know what we need to do, and we are wasting no time in addressing the challenges which the business faces. This includes ensuring the correct corporate governance structure and board is in place to guide the business going forward. I believe that we are doing the right things to get the business back on top form and delivering long-term sustainable growth.”
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