×
189
Fashion Jobs
NEEJ
Business Development Manager
Permanent · MUMBAI
LIFESTYLE BRANDS
Regional Sales Manager, Peter England - Bangalore
Permanent · BENGALURU
KITEX GARMENTS LIMITED
General Manager - Merchandiser
Permanent · ALUVA
ZODIAC CLOTHING CO LTD
Sourcing Officer (Fabric & Garment)
Permanent · MUMBAI
LIFESTYLE BRANDS
Head of Marketing, Louis Philippe - Bangalore
Permanent · BENGALURU
LIFESTYLE BRANDS
Manager - Online Sales &Amp; Merchandising Bangalore
Permanent · BENGALURU
LIFESTYLE BRANDS
Group Manager - E-Commerce Product (B2B)
Permanent · BENGALURU
LIFESTYLE BRANDS
Manager - Product, Louis Philippe
Permanent · BENGALURU
PANTALOONS HO
Senior Executive - Marketing
Permanent · PUNE
LIFESTYLE BRANDS
Manager - Trade Channel, Finance
Permanent · BENGALURU
LIFESTYLE BRANDS
Executive -Key Accounts (Mis),lp
Permanent · BENGALURU
LIFESTYLE BRANDS
Senior Executive - Garment Technician (ww &Amp; Kids), Pdqa
Permanent · BENGALURU
LIFESTYLE BRANDS
Sales Executive - Kannur &Amp; Kasargod
Permanent · BENGALURU
HIGH FASHION GARMENT COMPANY
Manager Humanr Resource (Male) From Mumbai Only
Permanent · MUMBAI
RAJ KHATRI FILMS PVT LTD
Digital Marketing Executive
Permanent · MUMBAI
ANANDGUPTA COUTURE
Social Media Marketing & Fashion Design Assistant
Permanent · MUMBAI
DESIGNR
Sales Officer
Permanent · NEW DELHI
NETE.IN
CRM & Logistics Executive
Permanent · MUMBAI
FABINDIA OVERSEAS PVT. LTD.
Retail Planner
Permanent · NEW DELHI
SELECTIVE GLOBAL SEARCH PVT. LTD.
Business Development
Permanent · NEW DELHI
AJIO - RELIANCE INDUSTRIES LTD
Sales Officer
Permanent · KARIMNAGAR
AJIO - RELIANCE INDUSTRIES LTD
Sales Officer
Permanent · MIRYALAGUDA

Superdry profit warning as Q4 is tough, but Dunkerton is confident

Published
today May 9, 2019
Reading time
access_time 3 minutes
Share
Download
Download the article
Print
Click here to print
Text size
aA+ aA-

It’s rare that companies don’t try to put a positive spin on a weak trading update. But Superdry didn’t do that on Thursday, although with the management team having only been in place for five weeks, the firm’s previous leaders are the obvious ones to blame.


Superdry



The retailer said of the 13 weeks up to April 27 (Q4) that its “trading performance continues to be weak [and] initiatives to stabilise and improve performance [are] under way.”

There was news that global brand revenue (GBR) did, at least, manage to rise by 3.6% for the full year, although Q4 itself looked weak and GBR fell.

The company saw “poor wholesale and e-commerce performance in Q4,” although there was an “improved own store performance”. And the whole thing came with a profit warning too as “full-year underlying profit before tax [is] likely to be below the range of market expectations.”

So, the figures. GBR was down 5.2% in Q4 to £406.3m, while group revenue dropped 4.5% to £187.8m. Wholesale dropped 9.3% to £89.7m, driven by “increased levels of returns, lower than anticipated in-season orders and decisions not to ship to customers that had reached their credit limits.”

And e-tail was down 3.9% to £29.3m. That figure is particularly worrying as even companies that are struggling usually manage to push e-ail up at a time when consumers are abandoning stores and turning to online channels instead. The performance "was impacted by the reduction of year-on-year discounting, including the removal of planned promotional activity” at the end of Q4.

Store revenue, by contrast, managed an uplift of 2.2% and even though space expansion accounted for 2.1% of that, it does still reflect a tiny rise in comparable sales.

The weakness in Q4 can be seen from the fact that, as mentioned, GBR rose 3.6% for the full year and even rose 0.3% for the second half. Group revenue was flat in the year and down 2.7% in H2, while wholesale rose 3.6% in the year and dropped 0.5% in the half. E-tail rose 1.6% in the year but dropped 1.7% in H2. 

All of those numbers highlighted how Q4 saw a faster decline. But as we said, the physical stores weren’t so bad with the 2.2% rise in Q4 coming against a 3.7% decline in the full year and a 5% drop in H2.

WORK IN PROGRESS

So what comes next? The programme to deliver £50m+ of gross cost savings by FY22 is continuing, but short-term profits will remain muted “primarily as a result of the weak wholesale and e-commerce performance, along with other measures to deliver the new operational strategy.” We won’t know the exact number until July 4 when the firm delivers its full-year results.

And what did co-founder Julian Dunkerton (who’s now CEO again) and his new chairman Peter Williams have to say about all this?

Dunkerton said that in his five weeks back at the firm he’s “identified immediate opportunities to improve the efficiency and performance of the business, and taken action.” He’s increased the number of options sold online with those additional options generating full-price sales; he's repopulated selected flagship stores with a greater density of stock; and reduced unnecessary promotional activity resulting in enhanced margins.

“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,” he added. “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 e-commerce proposition.”

And Williams said the trading statement “shows the scale of the challenge ahead of us. The company's financial performance won't be turned around overnight, but we know what we need to do, and we are wasting no time in addressing the challenges.”

Copyright © 2019 FashionNetwork.com All rights reserved.