Superdry shares fall after woeful half-year update

Superdry shares delivered more disappointment for investors on Friday as the company announced falling sales in a bleak half-year report.

Superdry’s sales crumbled by 23.5% in the half-year period to the end of October 2023. Statutory profit before tax only swung from £17m loss to a £3m profit due to the disposal intellectual property.

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The underlying message from the report is the group’s products aren’t as attractive as they once were, and falling sales are putting pressure on finances.

Just as Superdry’s products are falling out of fashion, the company’s shares are no longer all the rage and fell 3% on Friday.

There may be some solace for investors as far as there is a sector-wide slowdown in mid-range fashion, but Superdry’s problems are not new and certainly didn’t start due to a slowdown in consumer spending.

“The latest instalment of the Superdry saga isn’t a pretty one. Half year revenue fell over 23%, with the group laying the blame on an unseasonably warm December, highly competitive industry leading to discounts, as well as broader consumer weakness,” said Sophie Lund-Yates, lead equity analyst, Hargreaves Lansdown.

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“The area of the market that Superdry is targeting is a particularly difficult point on the spectrum. It’s not high end enough to be considered luxury, and it’s not a bargain option either. There have been well-documented slip ups operationally too, including poorly managed inventory. The net effect is one of widening losses and a worrying debt pile.

“The group’s substantial physical footprint adds pressure for sales volumes to improve sooner rather than later. Superdry is famous for its outerwear and warmer clothes, so the recent cold snap has added a bit of warmth into numbers, but not enough to thaw remaining challenges.”

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