Superdry issues profit warning after Christmas sales slide

Superdry, in its trading update covering the 10 week period to January 4, 2020 said, despite a strong Black Friday event, peak trading performance has been lower than expected. The company reported 15.8 percent decline in group revenue with store revenues down 18.5 percent, wholesale revenues down 16.9 percent and ecommerce revenue down 9.3 percent. Taking into account its revised sales expectations for the balance of the financial year, and the challenging trading environment, the company now expects underlying PBT to be in the range of nil – 10 million pounds.

Commenting on the trading update, Julian Dunkerton, the company’s Chief Executive Officer, said: “Everyone at Superdry continues to work intensively to deliver the turnaround of the business. A key element of the strategy is to focus on and return to full price sales and reduce promotional activity, and we halved the proportion of discounted sales over our peak trading period, benefitting both our margins and the Superdry brand. However this adversely affected our sales during the peak trading period given the level of promotional activity in the market.”

The company added that over the 10-week period the high street has seen unprecedented levels of promotional activity coupled with subdued consumer demand immediately after Christmas. These factors, combined with shortages of some better-selling product, driven by the need to reduce our inherited inventory position, adversely impacted our sales during peak trading.

Superdry further said that there have been lower than anticipated retail sales of 23 million pounds since Black Friday, predominantly online and wholesale performance has been impacted by certain timing issues during the quarter. While this shows a further 5 million pounds sales shortfall since Black Friday, the company expects this to partially reverse during the balance of the financial year.

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