Superdry reports drop in H1 revenue, but upbeat on recovery

Superdry has reported a fall in revenue in the first half of the year, but said it has seen an “encouraging” start to the AW21 season despite ongoing Covid disruption.

In the six months to October 23, group revenue dropped by 2.4 percent compared to a year earlier, but by a significantly larger 25.3 percent compared to two years ago.

The British fashion retailer said the pandemic continues to “materially impact” physical store trading, with its H1 performance hit by temporary closures in Europe, as well as the permanent closure of 15 stores, including its Regent Street store in July.

Footfall also remained “subdued” in all markets, and was down 27 percent in the UK despite the easing of Covid restrictions.

Store sales were up 21.7 percent compared to a year ago, but down 34.5 percent compared to two years ago.

Meanwhile, e-commerce sales were down 30 percent compared to a year ago, but up 7.6 percent compared to two years ago, while wholesale was up 1.2 percent compared to the prior year, but down 28.3 percent compared to two years earlier.

Supply chain delays

Like other global fashion brands, Superdry said it experienced supply chain disruption to its wholesale operations, and that despatches are 4-6 weeks behind plan. But it said it doesn’t “currently foresee a risk to the season, with the majority of this timing reversing in H2”.

The company said its full-price strategy continued to deliver increased profitability and in H1 resulted in an improvement in gross margin across both stores (5.6 percentage points) and e-commerce (9.2 percentage points) year-on-year.

Chief executive and co-founder Julian Dunkerton was upbeat on the company’s current trading.

“Once the new range landed and we began trading against a comparable full price period, we saw an acceleration into positive 2-year retail like-for-like growth,” he said.

“Our focus on full-price sales continues to deliver improvements in gross margin and I am pleased that we are ending the half with 10 percent fewer inventory units than last year.”

Dunkerton said he was “encouraged” by the performance of the company’s strategy, “which gives me further confidence in the full-year outlook”.