These half-year results from SuperGroup (SGP) - which is behind the Superdry clothing brand - are rather better than they seem. An accounting quirk forced the group to revalue its forward foreign exchange contracts at a time when the US dollar had hit a high, which meant a charge to the profit and loss account. Adjust for that, though, and underlying pre-tax profit actually rose 22 per cent year-on-year to £17.9m
The group's gross profit margin improved by 50 basis points in the period to a robust 56.8 per cent as well - that significantly reflected less discounting activity in the retail division compared with this time last year. Overheads should also fall once SuperGroup completes its long-running switch-over to a new Burton-on-Trent distribution site in time for the spring and summer season. Even before then, better stock management meant inventory levels fell 6.5 per cent year-on-year to £75.3m. New season lines are likely to be keenly anticipated, too, and the company's spring/summer order book is now running 26 per cent ahead of last year's level - which is of particular benefit to the wholesale division.
Broker Investec Securities expects adjusted full-year pre-tax profit of £62.5m, giving adjusted EPS of 56.8p (from £52.2m/47.4p in 2013).
SUPERGROUP (SGP) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,210p | MARKET VALUE: | £974m | |
| TOUCH: | 1,210-1,227p | 12-MONTH HIGH: | 1,265p | LOW: 533p |
| DIVIDEND YIELD: | nil | PE RATIO: | 34 | |
| NET ASSET VALUE: | 281p* | NET CASH: | £61.2m | |
| Half-year to 27 Oct | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 158 | 13.9 | 9.60 | nil |
| 2013 | 192 | 9.90 | 2.60 | nil |
| % change | +22 | -29 | -73 | - |
Ex-div:- Payment:- *Includes intangible assets of £42.3m, or 53p a share | ||||
