Today’s news in brief-12/6/24
The UK economy stalled in April 2024, showing no growth after a 0.4% increase in March, as wet weather significantly dampened consumer spending, according to the Office for National Statistics. Services output did rise by 0.2% for the fourth consecutive month and grew by 0.9% over the three months to April. Key contributions to this growth came from professional, scientific, and technical activities, which rose by 1.9%, transportation and storage up by 3.7%, and administrative and support services increasing by 2.1%.
Superdry’s creditors overwhelmingly supported a restructuring plan with a 99% approval rate, requiring only shareholder approval next. The plan includes rent reductions at 39 stores, delisting from the stock market, and an equity raise underwritten by founder Julian Dunkerton. This move follows Dunkerton’s failed attempt to take the company private earlier this year. If shareholders pass the resolutions, the High Court will sanction the plan at a hearing on June 17, 2024.
DFS has reduced its full-year profit guidance due to weak consumer demand and disruptions in the Red Sea causing delivery delays and higher freight costs. The company now expects a profit-before-tax of £10m to £12m, down from £20m to £25m, and revenues between £995m and £1bn. The upholstery market’s 10% volume decline contributed to this, though investments to boost order volumes provided some mitigation. Despite these challenges, DFS maintained a record market share of over 38.5% and saw a 9% increase in order intake in the fourth quarter. The company anticipates that lower inflation and interest rates will positively impact market demand in FY25.
Two former BHS directors, Lennart Hennington and Dominic Chandler, were fined £13m by the High Court for wrongful trading and misfeasance related to the retailer’s 2016 collapse. Each was fined £6.5m, with potential additional fines up to £133.5m. BHS’s administration led to 11,000 job losses and a £571m pension deficit after its sale to Dominic Chappell in 2015, who was later jailed for tax evasion. The liquidators, FRP Advisory, brought the case, accusing the directors of failing to address the company’s financial issues. The judge highlighted the liquidators’ efforts in recovering substantial amounts for the estate, including for the Pension Protection Fund.
Sportswear brand Castore is set to open a new store in Milton Keynes’ Centre
in late June, showcasing its full mainline range and selected teamwear for McLaren Racing and Oracle Red Bull Racing. This 865 sq ft location is part of Castore’s new store concepts designed by Ink Associates.
Retailers are expected to see a significant boost from the upcoming Euros, according to a British Retail Consortium poll of 2,000 shoppers. With weak retail sales growth of 0.7% in May, the involvement of England and Scotland in the tournament is likely to drive spending, especially on groceries and electronics. One in eight people plans to spend more on drinks and snacks, and over one in 20 on new screens to watch the games.
