It took a while, but the former SuperGroup eventually had an excellent 2017. Though it spent most of the first 9 months of year trapped between £15 and £16, a sharp rally in the final quarter saw the index close out December at £19.85. Compared to an opening price of £16.53, that’s a 20% increase across the 12 months.
Very briefly it looked like Superdry was going to maintain this climb in 2018, hitting an all-time high of £20.81. Since then, however, things have gone horribly wrong for the fashion retailer. The stock has been in freefall, and now sits at an 8 month low, and current trading price, of £15.03 – a 25% plunge from where it began the year.
The company’s first major drop came following January’s update, a release that sent it nearly 9% lower in a single session. It was a busy statement, with both the interim results for the 26 weeks to 28th October AND the peak trading figures for the 10 weeks to 6th January.
Those half year figures were pretty stellar: group revenue rose 20.4% to £402 million, with a 20.5% jump in underlying pre-tax profit to £25.3 million. However, reported pre-tax profit actually fell 28% to £9.1 million due to a £15.9 million charge relating to its foreign exchange hedging strategy.
It was that reported profit number, alongside its holiday season performance, that investors were put off by. Though Superdry managed a 4.7% increase in like-for-like sales for those 10 weeks, that’s a huge slowdown compared to the 14.9% rise seen during the same period the year previous.
Beyond the results themselves, CEO Euan Sutherland spoke of how womenswear is the company’s ‘single biggest opportunity’ for future growth, though the firm did warn increasing its place in that market ups the pressure of responding to fashion and design trends ‘in a timely manner’. Sutherland also spoke of the ‘huge’ potential in China.
Superdry suffered another round of losses at the end of March, as investors reacted poorly to the news that co-founder Julian Dunkerton was leaving the company (even if it wasn’t a total shock given his reduced role over the last few years).
In terms of next week’s update, investors will be hoping that the fourth quarter’s like-for-like sales haven’t seen the same drop off as those in Q2 and Q3. They will also want to hear the firm’s full year profit guidance.
SuperGroup PLC (LON:SDRY) has a consensus rating of ‘Buy’ alongside an average target price of £21.03.
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