Superdry swings to loss as demand stalls

SUPERDRY has swung to a £150m loss as it warned over stunted sales growth this year amid intense pressure on shoppers.

Julian Dunkerton, founder and chief executive of the fashion retailer, said conditions in the retail sector had proven “extremely challenging”, as Superdry recorded a loss of £148m after tax for the year to the end of April, compared with a profit of £22m a year earlier. Sales were up just 2.1pc in the year.

Mr Dunkerton said trading had not improved over the summer months, and in the 13 weeks since the end of April, revenues are down about 18pc year-on-year.

He said: “The start to the new year has been tough, not helped by unseasonal weather and highly promotional markets, and I’m not expecting the consumer environment to get any easier.”

Superdry is not anticipating significant revenue growth this year, and instead will focus on reviving profits. It is currently seeking to reduce costs by £35m, with steps including job cuts in its head office. Superdry released the accounts after a delay to the audit, which meant it was forced to request its shares be suspended earlier this week.

Shares are expected to resume trading following the release of the accounts.

Superdry pointed to particular pressure in its wholesale business, where revenue slumped almost a fifth. This is the part of the company where it supplies into department stores and online retail- ers. Mr Dunkerton said these businesses were trying to reduce their exposure to risk by switching their models, so they are no longer buying stock up front and then selling it to shoppers. Instead, retailers such as online store Zalando are selling Superdry clothes that are then fulfilled from Superdry’s stock.

Meanwhile, sales in its own stores have taken a hit from the wetter summer, which has dampened demand for items such as swimming shorts and Hawaiian shirts.