Superdry's (SDRY) shares lost roughly a fifth of their value following a profit warning. Management blamed the recent heatwave, as well as “the well-publicised” challenges facing some of its trading partners, which include House of Fraser, for the potential £10m knock to full-year profits. The group says it’s still pursuing an 18-month transformation programme, aimed at reducing its reliance on bulkier items such as coats and jumpers, and accelerating expansion into categories such as dresses, skirts and denim.
But historic foreign exchange policies have also failed to provide adequate protection against continued weakness in sterling compared with global currencies. This is expected to lead to an additional £8m in costs, spread evenly over the financial year.
In terms of where sales will go this year, global brand revenues are expected to report mid-single-digit growth rates, with e-commerce sales estimated to rise at roughly the same pace. But in terms of the group’s own stores, sales are expected to contract at a low-single-digit rate as challenges persist on the high street. In fact, recent BRC-Springboard footfall data showed a 1.7 per cent decline in September.
