Superdry H1 revenues fall as Covid hits store footfall

Superdry has reported a drop in revenue for the first half of the year, slightly offset by a jump in e-commerce sales, in what has been a tough year for physical retail.

For the six months to 24 October, total revenue fell 23.3 percent compared to the same period last year, comprising a 24.1 percent drop in the first quarter and a slightly smaller 22.8 percent drop in the second.

The British fashion retailer said this drop reflected “the challenging trading environment as a result of continued disruption from Covid-19”, with its stores post-first-lockdown still impacted by Covid-related measures suppressing footfall, particularly in large city centre locations.

Like-for-like store sales in the last six weeks of H1 were down 32.4 percent, with poor footfall in the UK partially offset by stronger performance in Europe where footfall declines have been less severe.

As of 5 November, 122 of its stores have been temporarily closed across England, Wales, France, Belgium and Ireland amid new lockdowns - 117 stores are still open and trading.

Wholesale also continued to be impacted by the pandemic. The retailer said performance in Q2 in part reflects later phasing of AW20 forward order deliveries, with 68 percent shipped year to date compared to 84 percent at the same time last year.

Online sales offer slight relief

E-commerce offered some respite for the company, performing well and strengthening through Q2 21. Like-for-like sales were up 51.9 percent in the last six weeks of H1, an improvement driven by owned site sales which increased 68.9 percent year-on-year coinciding with the launch of its new AW20 product and the targeted clearance of aged stock.

Superdry said increased promotional activity in the period in response to Covid-19 hit its gross margin. However, that has been partially offset by its focus on cost management and cash preservation actions, the company said.

“Covid-19 continues to disrupt our store and wholesale channels, but this is being partially mitigated by strong sales through our e-commerce operations,” CEO Julian Dunkerton said in a statement.

“This has been an important period for Superdry, with the launch of our full Autumn/Winter 20 ranges and a true focus on using our social channels to reach our customers and bring our brand reset to life. This activity is delivering record levels of engagement through our influencer-led Autumn campaigns, and we will focus our energies in this area over the coming months led by our new chief marketing officer, Justin Lodge.

“The external outlook is very uncertain. However, we have financial flexibility and are making good progress with our strategy and brand reset. We are determined to do the right thing by all our stakeholders - including colleagues, our retail and wholesale customers and investors - to ensure the business and brand returns to success.”

Photo credit: Superdry

 

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