SuperGroup back on form with plans to grow further

TRENDY fashion firm SuperGroup yesterday cheered a “return to form” as it outlined plans to spend £30 million on ramping up expansion in the UK and overseas.

Models sport the Superdry Spring/Summer range. Picture: Contributed
Models sport the Superdry Spring/Summer range. Picture: Contributed
Models sport the Superdry Spring/Summer range. Picture: Contributed

The group, which owns the Superdry, Cult and SurfCo California brands, said new womenswear and a bigger range of jeans would help drive sales after it posted a 22 per cent hike in underlying profits to £52.2m for the year to 28 April.

Its solid performance comes in marked contrast to the previous 12 months when profits slumped by almost 15 per cent following an accountancy blunder and after being caught out with stock shortages.

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The group retrenched to focus on getting the business back on track, and co-founder and chief executive Julian Dunkerton yesterday hailed “significant opportunities for growth”.

Having added 66,000sq ft of retail space over the past year, it now plans to boost its estate by 80,000 to 100,000sq ft across the UK and Europe and add some 50 franchised stores internationally.

It is also setting its sights on China with aims to trial a website there next year, adding to the 16 sites worldwide. SuperGroup has 85 fully-owned stores across the UK and Ireland.

Dunkerton, who co-founded the group as a market stall in Cheltenham, said: “The financial performance for the year represents a return to form.”

The firm described trading in the first nine weeks of the new financial year as encouraging.

“Customers’ reactions to the new spring/summer ranges have been positive and womenswear has performed well,” it added.

Canaccord Genuity analyst Wayne Brown said: “We see the internationalisation of the group’s estate coupled with rising margins and organisational change as the key drivers moving forward.”

The brokerage reiterated its “buy” rating on the stock.

Peel Hunt analyst John Stevenson added: “[This] marks the end to a transitional year which has seen the group move from firefighting to stability and now moving forward to controlled global expansion.”

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Meanwhile, budget fashion chain Primark flagged a “marked improvement” in sales yesterday as the warmer weather helped it underline its high street dominance.

Like-for-like growth was subdued by the cold conditions in March and April but did much better in May and June, parent company Associated British Foods said.

Total sales were up by 20 per cent in the 16 weeks to 22 June, giving a figure of 22 per cent for the first 40 weeks of the financial year due to an increase in selling space as well as sales growth.

The company did not publish figures on a like-for-like basis but analysts suggested a slowdown to 3 per cent in the 16-week period after a 7 per cent rise in the previous half year.