‘Worse than expected’ Superdry results send its shares plummeting as former boss agitates for return to top table
- Half-year profits fell 49% to £12.9million, 5% under analyst expectations
- Superdry warned full-year earnings would be between £55m and £70m
- The disappointing results triggered a 32% fall in its share price to £3.73
- Former boss Julian Dunkerton has criticised management and wants his job back
‘Worse than expected’ results and another profit warning sent struggling Superdry stocks tumbling by more than 32 per cent today.
The fashion firm, which has seen its shares crash 81 per cent across the year, came clean today about a massive 49 per cent decline in half-year profits, as well as poor store sales and deteriorating margins.
It also warned that its earnings for the full-year will fall short of the mark.
Superdry was hit by warm weather this year as it reduced demand for its winter coats
The half-year numbers were worse than analysts predicted and triggered a sharp sell off, taking the firm’s share price to below £3.74, lows not seen since 2012.
AJ Bell investment director Russ Mould said: ‘Expectations were already low for Superdry given mild weather having a negative impact on coats and jackets.
‘However, its half year results are even worse than expected, prompting questions as to whether the business has really lost its way.’
In recent months, former chief executive Julian Dunkerton has been vocal about his desire to return to the helm of the fashion group he co-founded, openly slamming the strategy of current management.
Superdry shares have fallen 81% in the last year, down from highs of above £20 to £3.74 today
Mould added: ‘Shareholders will be fuming, including Dunkerton who maintains a decent sized stake. Perhaps activist investors will target the business and back Dunkerton in trying to save the business.’
Commenting on the boardroom bust-up on a call with journalists this morning, chairman Peter Bamford said Dunkerton’s views on strategy ‘have not evolved with the needs of what is now a multi-channel, international and increasingly digital retailer’.
Former boss and co-founder Julian Dunkerton (above) has slammed current management as the value of his holding declines
Group sales were up 6.4 per cent during the period, but this was predominately driven by online sales.
The company has pledged to review its store portfolio as it looks to cut costs and will consider shop closures, downsizing, relocation or renegotiation of rents.
Superdry unveiled a new kidswear range today, but Dunkerton is concerned the move will put off teengagers
The firm also announced the launch of a kidswear range. But the move was quickly denounced by Dunkerton, who says it will weaken demand for the brand among teenagers.
Chief executive Euan Sutherland reiterated his confidence in the current strategy.
He said: ‘Our comprehensive transformation will ensure Superdry is well positioned as we optimise our routes to market and make our business more efficient.’
‘At the end of the day you have to ask: does the public still want to wear its products?’ asked Mould.
‘Its brand is associated with clothes that have Japanese writing on them. That seems like a fad which may have peaked.
‘Superdry should really think about how to differentiate itself from the competition. It needs to be more creative and give customers plenty of choice.’