10th Jul 2019 09:12
(Alliance News) - Superdry PLC on Wednesday reduced its annual payout after reporting a swing to loss in its most recently ended financial year.
The company chopped its final dividend to 2.2 pence a share from 21.3p last year, taking the full-year payout to 11.5p per share, little more than a third the 31.2p paid in its financial 2018.
The clothing retailer said its revenue for the 52 weeks to April 27 was GBP871.7 million, broadly flat compared to GBP872.0 million reported for the same period a year ago, due to "a difficult retail climate".
Superdry explained that its first half performance benefited from discounting and space growth, but it saw poor performance in the second half across all channels.
The company posted a loss of GBP85.4 million, compared to GBP65.3 million profit reported a year earlier, as its underlying operating margin declined by 600 basis points to 5.5% from 11.5% the year before.
Meanwhile, sales & distribution costs, which include costs associated with operating stores, depreciation and transporting products, totalled GBP372.4 million for the year, up 7.5% from GBP346.4 million a year prior.
Underlying central costs, which include the costs of operating Superdry's global operations teams, support functions and related depreciation, were GBP74.6 million compared to GBP72.1 million, an increase of 3.5% year-on-year.
At the time of its interim results in December, Superdry announced a review of its owned-store portfolio. As a result of this review, and reflecting revised cautious future projections, unprofitable stores have been identified. Accordingly a non-cash net impairment and onerous lease charge has been made of GBP129.5 million, affecting 114 stores.
Looking ahead, Superdry said global retail markets are expected to remain highly competitive and the consumer outlook continues to be uncertain, including the continued uncertainty of the impact of Brexit.
The company said it expects its revenue to show a slight decline in its current financial year, particularly in the first half, as it rebalances promotional activity and strengthens the brand.
Superdry said financial 2020 will be a year of "reset", during which it intends to create a platform helping it to return to long-term profitable growth.
Back in April, the Chief Executive Officer Euan Sutherland and the Chief Financial Officer Ed Barker stood down from the board with immediate effect. Founder Julian Dunkerton was appointed interim chief executive officer to "direct and strengthen" the business.
"The issues in the business will not be resolved overnight. My first priority on returning to Superdry has been to steady the ship and get the culture of the business back to the one which drove its original success," said Dunkerton.
She added: "Although we are only three months in, our initiatives are gaining some early traction, and I am confident we are doing the right things to ensure that over time Superdry will return to strong profitable growth."
Superdry shares were trading 2.5% lower on Wednesday morning in London at 436.06p each.
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