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Superdry has lowered its FY23 guidance to £615m-£635m after sales in February and March were “below expectations”.
The company stated that while sales were showing significant year-on-year growth they were not what the company expected.
It has put this down to a number of external factors like the cost-of-living crisis having a significant impact on spending and footfall, and poor weather resulting in less demand for its spring-summer collection.
As a result the company has identified initial cost savings of over £35m which have been externally validated.
These will be achieved through estate optimisation, logistics and distribution savings, better procurement, and continued range reduction.
Furthermore, the company has agreed, subject to certain conditions, to sell its IP assets in certain countries within the Asia Pacific region for $50m (£34m net after transaction costs and taxation).
Superdry is also considering additional steps to further strengthen its balance sheet which could include a potential equity issue.
It is considering an equity raise of up to 20% of the company’s issued share capital. Founder Julian Dunkerton will “fully support and materially participate in any such equity raise”.
Dunkerton said: “The Superdry brand continues to evolve but there is no doubt that the market conditions we face are challenging, compounded by the issues we have previously disclosed and are working to address in Wholesale. As a result, while we continue to deliver like-for-like growth in retail sales, we need to ensure our business is in the right shape to navigate these difficult times, which is why we are looking hard at our cost base.
“My belief in the Superdry brand is stronger than ever which is why I’m prepared to provide material support to any equity raise undertaken. I am confident that we have the right plan and, working together as a team, the business will emerge from the current turbulence stronger than ever.”
