Superdry has warned that profit for the year will fall short of previous guidance, sending shares in the fashion brand down 16 per cent.
The retailer, which is known for its hoodies and jackets once flaunted by David Beckham and Idris Elba, said that sales in February and March have fallen short of its expectations.
It blamed ‘factors outside the company’s control’ for disappointing sales, including the cost of living crisis and poor weather knocking demand for its spring-summer collections.
Superdry has decided to withdraw its previous profit guidance after disappointing sales
The company told shareholders it has decided to withdraw its previous profit guidance that it would broadly breakeven for the 2023 financial year.
It also announced cost cuts of around £35million, which it plans to achieve through ‘estate optimisation’ – which indicates possible store closures – as well as more reductions to its clothing ranges.
Meanwhile, founder and chief executive Julian Dunkerton, who has previously dismissed speculation he was looking to take the company private, said the group was considering a fundraise of up to 20 per cent in a bid to shore up cash.
Superdry shares fell 16 per cent to 89.90p in early trade on Friday, back to their lows of 2020 during the pandemic.
They have tumbled by 35 per cent since the start of the year and by 50 per cent in the last 12 months.
‘The Superdry brand continues to evolve but there is no doubt that the market conditions we face are challenging, compounded by the issues we have previously disclosed and are working to address in wholesale,’ Dunkerton said.
‘As a result, while we continue to deliver like-for-like growth in retail sales, we need to ensure our business is in the right shape to navigate these difficult times, which is why we are looking hard at our cost base.
‘My belief in the Superdry brand is stronger than ever which is why I’m prepared to provide material support to any equity raise undertaken.’
Chris Beauchamp, chief market analyst at trading platform IG Group, believes Superdry’s troubles come from the company having failed to present a compelling plan for the long term.
‘Superdry might blame the cost of living crisis and bad weather for its performance but the market hasn’t been so discriminating, knocking the shares back to 2020 lows,’ he said.
‘It’s a far cry from the near £20 share price of five years ago, but Superdry has consistently failed to lay out a compelling plan for the longer-term, and it has suffered accordingly.’
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