Superdry issues profit warning

The retailer blamed the profit warning on “poor wholesale and ecommerce performance in quarter four” and said that “actions to address this underperformance were under way”.

Superdry reported that its group revenue for the year was flat but had fallen by 4.5% in the fourth quarter overall.

For the 13 weeks to April 27, 2019, wholesale revenue plummeted 9.3%, despite being up 3.6% to £335m year on year. Superdry said the fourth-quarter tumble in wholesale revenue was due to “increased levels of returns, lower than anticipated in-season orders and decisions not to ship to customers that had reached their credit limits”.

The retailer’s ecommerce revenue fell 3.9% during the period as well, due to the impact of a reduction in year-on-year discounting and promotional activity.

It said that while store performance improved in the fourth quarter, sales were still down 3.7% year on year to £373m.

The update comes roughly five weeks after Superdry founder Julian Dunkerton seized back control of the business from former chief executive Euan Sutherland.

In that time, Superdry said it has taken a number of actions to remedy its falling profits, including: increasing the number of products it sells online, repopulating flagship stores with greater densities of stock, and is aiming to introduce 500 new products within the next six months.

The retailer also aims to deliver more than £50m in gross cost savings by the end of the 2022 financial year.

Superdry said that further detail would be provided at its full-year results announcement on July 4.

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 that 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.”