Superdry warns of sales decline following stock exchange departure

Superdry has warned that its sales for the current financial year will continue to fall, following its departure from the London Stock Exchange to focus on its new restructuring plan. In documents filed with Companies House for the 52 week period ended 27 April 2024, the group reported a 22% decrease in group revenue to £488.6m from £522.5 in the prior year. It attributed this decline to the continued underperformance of its wholesale division, which was down 36% to £117.0m, but also impacted by softer performance from its retail segment, which reported a 16% drop in sales to £371.6m. According to Superdry, while the results of its wholesale channel were expected due to strategic decisions taken by the business, the decline was also reflective of the continued underperformance of the channel and the challenges it faced in trying to restructure that segment to deliver growth. Similarly, its retail sales decline was predominantly driven by a combination of declining stores (down 18% to 146m) and ecommerce sales (down 14% to 225m). Additionally, the fashion retailer’s pre-tax loss dropped from £78.5m to £65.2m. However, its gross margin improved by 2.2 percentage points to 55.0%. Looking ahead, the group stated that it is targeting revenue of between £350m to £400m, a gross margin slightly ahead of its current levels and a mid to high single digit EBITDA margin. Superdry said: “This has been a difficult period for Superdry, and our challenges have been well documented. Despite the progress made on our cost reduction initiatives, and steps taken to create an operating model suitable for the needs of the organisation over the longer term, the weaker than expected financial performance necessitated further action in the form of the restructuring, equity raise and delisting, outlined to the market in April 2024. “The directors and wider management team have placed great emphasis on the delivery of our cost efficiency programme, with in excess of £40m of savings realised within the year. This has resulted in significant reductions across our selling and distribution and central costs, further validating our ongoing efforts to right-size our operating cost base. Continuing to bring down costs remains an area of ongoing prioritisation for the group.”