Superdry today reported falling sales across all of its sales channels in the first half of its financial year as it moves away from discounting.
The fashion retailer, ranked Top100 in IRUK Top500 research, reported group revenues of £367.8m in the 26 weeks to October 26 2019 in a half-year pre-close trading statement. That’s 11.3% down on the same time last year. Store sales of £157.3m were 11.7% down, online sales of £57.9m were 10.5% down and wholesale turned over £152.6m, down by 11.2%.
Sales had fallen, said the retailer, following a ‘reset’ year in which the brand was addressing a number of legacy issues. It is now focusing on full-price sales while reducing promotions.
Julian Dunkerton, who returned to lead the brand he founded earlier this year, has said he will concentrate on returning it to its design-led roots with a focus on ecommerce.
Today the retailer said that it was working through legacy stock in its stores while moving on from significant promotional activity in the previous year’s comparatives. “As expected, the full price stance has resulted in a sales decline, but this has been partially offset by an improvement to gross margin,” it said.
Onlne, it says, the sales decline has slowed as it introduces new products and improves the online shopping experience, while engaging further through social media. Here again, it says, margins are improving as a result of its full-price stance. Its wholesale customers, says Superdry, have responded well to the new full price position, along with improved design and quality.
Superdry chief executive Julian Dunkerton said: “We are making good progress with the start to our turnaround plan for Superdry, returning the business to its design led roots. We have always said it will take time, but we have a strong team which is working incredibly hard to deliver this plan. I’m genuinely excited by new injection product which has started to land in stores for this peak and even more excited about the new ranges signed off for next year.
“We are moving the business away from a reliance on constant promotions, and while this focus on full price sales has affected revenue in the first half, this is being partially offset by a better gross margin performance. There is good momentum in the business, and I remain confident of returning Superdry to sustainable long-term growth."
He added: “We have taken swift and decisive action to implement strategic changes as part of the business reset, which is a two to three year programme to gain full control of the product and costs. We are confident in delivering further benefits from reset initiatives across Superdry in the second half. However, we remain cautious about the challenging market conditions over the peak trading period."
Image courtesy of Superdry