Superdry has indicated that profits will fall below the projected figures after trading “significantly below management expectations”.
The fashion seller noted that sales in the first half of its financial year were affected by a “challenging consumer retail market and the unusually mild autumn”.
Retail sales declined by 13.1% compared to the prior year, while wholesale sales saw a 41.1% decrease, as anticipated due to the decision to exit its US wholesale business.
Although there has been some improvement in performance since then, sales in the six weeks following the half-year are still down approximately 7% on a like-for-like basis. However, Superdry mentioned that it had made progress on its cost savings program and is on track to achieve £35 million in savings within the year.
The company also noted that its inventory reduction program was on track as it continued to clear aged stock.
CEO Julian Dunkerton stated, “The unseasonal weather through the early autumn led to a delayed adoption of our Autumn/Winter range and this impacted sales in the first half of the year.”
“While we have seen modest signs of improvement with the recent colder weather, current trading has remained challenging, and this is reflected in the weaker-than-expected business performance. The operational progress we have made in the first half has been more encouraging with the IP sale for the South Asian region and substantial headway on our cost efficiency program.”
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