Superdry reported a 23.5% fall in group revenue, which it attributed to a “challenging consumer retail market”. The brand also said it was impacted by unseasonable weather and “underperformance” in its wholesale segment.
Heavy discounting across the sector in the build-up to Christmas was said to have impacted Superdry’s progress since. It said it expects its full year results for 2024 to reflect the “more challenging environment” seen to date.
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The brand pointed out it is making progress on its turnaround programme, which focuses on “improving efficiency, driving simplification and establishing a target operating model”.
Superdry’s founder and CEO Julian Dunkerton said that H1 2024 had been a “difficult period” for the company.
The news comes shortly after Superdry was allegedly in talks with accountancy firm PricewaterhouseCoopers to consider debt-raising options. It also issued a profit warning in December after it disclosed that its 26-week period ending 28 October 2023 had been “significantly below management expectations”.
Key results for Superdry in H1 2024
- Group revenue down 23.5% to £219.8m ($279.82m), with retail down 13.1% and wholesale down 41.1%
- Cost reduction scheme set to deliver £40m in savings in FY 24
- Inventories down 24.2% in HY 1 2024 at around 7m units, down from a peak of 18.9m units in 2019.
- £25m secondary lending facility agreed with Hilco Capital.
Ecommerce sales were also an issue for Superdry in H1 2024, falling by 19.1%. This was attributed to warmer weather, as well as a reduction in digital marketing spend, aimed at increasing profits.
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By GlobalDataStore sales were said to be “more robust” but still fell 9.9%, which Superdry blamed on unseasonal weather and the timing of its promotions.
“A challenging consumer retail market, set against a backdrop of macroeconomic uncertainty and some remarkably unseasonal weather conditions have all combined to weaken the financial performance of the group,” Dunkerton said in a statement.
However, he added that the company had made “significant operational strides” towards its turnaround plan.
“We have also taken further action to support the balance sheet with a secondary lending facility agreed with Hilco Capital in August, and the agreement for a joint venture and disposal in South Asia, demonstrating the continuing attractiveness of the brand in foreign markets,” Dunkerton added.
What next for Superdry?
Dunkerton said that Christmas had proved challenging for Superdry and admitted that it does not expect market conditions to get any easier in the near-term. “However, I firmly believe we are taking the right steps for the business and the brand, to return Superdry to profitability,” he added.
In the 12 weeks since H1 2024, Superdry reported “encouraging sales” during recent spells of cold weather in the UK, although the milder autumn weather negatively affected group revenue, which is down 13.7%.
Both online and in store sales have fallen by more than 10% as the brand reported consumers completing Christmas shopping earlier and taking advantage of Black Friday sales.
