COVID-19: Superdry struggles with store closures

COVID-19: Superdry struggles with store closures

COVID-19: Superdry struggles with store closures

Superdry plc (LON:SDRY) shares crashed on Wednesday after the company issued a warning concerning the evolving COVID-19 outbreak.

Shares in the fashion retailer were down by over 21% during trading on Wednesday.

Superdry said that it is experiencing “unprecedented challenges” as the virus continues to spread.

In order to mitigate the impact of the illness, the company has temporarily closed stores in many countries.

Superdry added that, because this will significantly impact trading, it will not be able to meet its guidance.

As uncertainty surrounding the outbreak of the virus continues, the company will not be providing formal guidance for the 2020 financial year.

Currently, 78 stores across Europe are affected by government closures, Superdry said, which makes up the majority of its European store estate.

Most stores in the UK and the US remain open, but footfall has reduced significantly during a time when people are being told to stay at home and self-isolate.

“Given the performance to date, we do not expect the decline in sales from our retail stores to be fully mitigated by sales through our Ecommerce channel, which remains fully open for business. Whilst we are also pursuing cost saving measures across the business, we do not expect these to be sufficient to offset the sales decline,” Superdry said in a statement.

Along with everyone else, Superdry is experiencing major disruption to our business operations and recovery as we seek to protect our staff and customers from COVID-19,” Julian Dunkerton, Chief Executive Officer, said.

“We are taking mitigating action wherever we can but the situation is very fluid and uncertain, and we are working to put in place additional financing to secure our recovery,” the Chief Executive Officer continued.

Julian Dunkerton added: “We also welcome the measures announced by the Chancellor yesterday to support UK businesses. The safety of our staff and customers remains our number one priority and we continue to take all appropriate action in line with local government advice. Together, we’re going to make our way through this unprecedented challenge, and I’m confident we can reset the brand and deliver on our transformation plans.”

Shares in Superdry plc (LON:SDRY) were down on Wednesday, trading at -21.66% as of 13:21 GMT.