Sep 16, 2021
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Times stay tough for Superdry but it expects revenue recovery in current year

Sep 16, 2021

Superdry’s preliminary results for the year to April 24 were released on Thursday and showed the company being “significantly impacted by Covid-19 disruption”. That’s no surprise given that the year covered the height of two waves of the pandemic and two lengthy lockdowns. That meant 39% of its store days were lost.


And times have stayed tough since the new financial year began. In an update for the period after the financial year-end (up to August 18), it saw only a 1.9% increase in group revenue year-on-year, and when compared to the same weeks in 2019 (2YoY), group revenue dropped 29.6%.

In the latest four months, store sales were up 33.1% YoY but down 36.9% 2YoY. The growth through stores YoY was helped by a 76% UK rise and 169% US rise, but this was partially offset by the EU, which suffered from further closures at the start of the current period and was down 10%.

While e-commerce was up 8.2% compared to the same period in 2019, it was down 34.4% compared to 2020. E-commerce sales were “more modest against the extraordinary growth we experienced in the prior year,” it said. “The return to full-price trading resulted in a less pronounced uplift during the sale period, but did drive online gross margin up 10.5ppts year-on-year.”

It added that wholesale revenues have also started to recover, increasing 12.7% YoY as its partners “gain more confidence in the macroeconomic outlook. We would expect this recovery to continue as they sell-through carried-forward stock and see their markets return to normality”.

Looking back at the full year to April, group revenue fell 21.1% to £556.1 million and the gross margin dropped to 52.7% from 53.6%. The adjusted loss before tax was £12.6 million and the statutory loss before tax was £36.7 million. But both of these last figures represented an improvement of 70% or more.

And the outlook? The company said “significant market uncertainty remains”, but it expects “a recovery in total revenue in FY22”, which is the current financial year. This will be partly driven by improving store trading from gradually improving footfall throughout the year, “although not reaching historic levels”.

Also contributing will be strong two-year e-commerce growth compared to FY20, “but suppressed year-on-year as we anniversary tough promotion-driven comparatives and some trade switches back into physical stores”. And a “modest, but sustainable revenue recovery in Wholesale” should make an impact too.

It expects margin to increase across all channels as it transitions towards a full-price stance, “supported by further mix benefits from the switch back into stores”.

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