By Michael Susin
Superdry, the British clothing brand, has warned that its full-year performance is expected to suffer due to persistently challenging market conditions. This follows a drop in revenue for the first half of fiscal 2024 and news of the company’s chief financial officer stepping down.
Despite a 0.7% increase in shares to 17.0 pence at 0826, Superdry continues to trade near its all-time low after a significant 90% decline over the past year.
During the six months ended October 28, revenue fell by 23.5% to £219.8 million, or $279.3 million. The decline in sales can be attributed to unseasonably warm weather and underperformance in the wholesale segment.
However, the company managed to achieve a pretax profit of £3.3 million, a considerable improvement compared to the loss of £17.7 million during the same period last year. This positive outcome was primarily driven by the sale of intellectual property in the Asia and Pacific region. On an adjusted basis, which excludes exceptional and other one-off items, the pretax loss widened to £25.3 million from £13.6 million.
Looking at the 12 weeks leading up to January 20, Superdry experienced a 14% decline in revenue, primarily due to milder weather and heavy discounting across the sector impacting Christmas sales.
Within the same period, wholesale revenue plummeted by 38.0% due to decreasing volumes and structural changes within the broader market, compounded further by strategic decisions made by the company.
Overall, Superdry faces significant challenges brought upon by unfavorable market conditions and must work diligently to reverse its declining performance.
Superdry’s Performance Continues to Decline
Superdry has confirmed a drop in performance, which aligns with the profit warning issued in December. The company attributed the decline in sales of its Autumn and Winter range to the mild weather and tough market conditions. As a result, shares fell by 17%.
Impact of Milder Autumn on Superdry
Although Superdry experienced some encouraging sales in outerwear during colder spells, the milder autumn had a negative impact on overall sales during the peak Christmas trading period. The company expects its full-year results to reflect the challenging environment it has been facing.
Change in CFO Position
Superdry announced that Shaun Wills, Chief Financial Officer, will be stepping down on March 31. Giles David will take on the role of interim CFO, starting on Monday. It is expected that David will be appointed to the board on April 1.
Progress on Turnaround Program
Superdry remains committed to its turnaround program. The company is focused on improving efficiency, driving simplification, and establishing a target operating model. It anticipates saving over GBP40 million within the year as a result of these efforts.
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