Superdry withdraws full year profit guidance as it considers equity raise
Fashion retailer Superdry has withdrawn its full year profit guidance and is considering a potential equity issue to strengthen its balance sheet.
This could be up to 20% of the company’s issued share capital.
Due to a challenging trading environment, Superdry has withdrawn its existing profit guidance of ‘broadly breakeven’ for its full year. Meanwhile revenue is expected to come in at between £615 million and £635 million in the period compared to £609 million in the prior year.
Superdry said its retail sales in February and March showed significant year-on-year like-for-like growth but failed to meet expectations. The retailer attributed this to the cost-of-living crisis and poor weather affecting demand for its new spring/summer collection.
It has also confirmed that it has identified initial cost savings of over £35 million as part of its turnaround plan.
Julian Dunkerton, founder and chief executive of Superdry, said: “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. 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.”
The retailer’s lender Bantry Bay has indicated its support for the retailer’s disposal of IP assets in certain countries within the Asia Pacific region for £34 million and has increased flexibility of Superdry’s existing facility.
Dunkerton added: “I am confident that we have the right plan and, working together as a team, the business will emerge from the current turbulence stronger than ever.”
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