7th Nov 2013 12:18
LONDON (Alliance News) - Supergroup PLC reported a further uptick in sales in the second quarter of the year ended October 27, taking total group sales in the first half of the year to GBP191.6 million, an increase of 21%.
The clothing designer and retailer, whose core profiling group is students and customers aged around 16-24 years old, reported a 19% rise in total group sales in the second quarter of the year, to GBP116.6 million.
Supergroup said that the strong trading performance in the quarter was in line with management expectations, and is confident in its full year outlook. It said it will announce its half-year earnings on December 12.
"Our trading performance, the positive customer reaction to new product ranges and the preparation ahead of peak trading, provides me with confidence in our ability to meet market expectations," Chief Executive Officer Julian Dunkerton said.
Supergroup reported a 20% increase in sales from its retail division during the second quarter, and an 19% increase to GBP116.7 million for the first half of the year.
"We are a far more professional and efficient company now, with a larger product range. Those are the main reasons behind this strong growth, and it will continue to be a driver going forward," Dunkerton told Alliance News after reporting its second quarter figures.
Supergroup said like-for-like retail sales were up 7.8% for the quarter, and up 8.1% for the half year.
The group recently launched its Superdry Premium collection, a range of clothing it has targeted at a slightly older consumer, in order to attract a wider age group.
"It was received really well. Our Superdry Town Coat for women priced at GBP249 sold amazingly, and we have just had to get more stock in," said Dunkerton.
The group added 33,000 square feet of retail space during the second quarter, taking the total store space to 573,000 square feet.
"We are on track for our target of adding between 80,000 and 100,000 square feet of new store space this year, and a similar amount next year," Dunkerton said.
Supergroup opened three new stores in the UK during the quarter, and acquired two third-party franchise stores which it has incorporated into its owned store estate.
In Europe, the group opened two further stores, one in Belgium and another in an out-of-town development north of Paris.
The clothing retailer said that wholesale sales rose 17% in the second quarter to GBP53.1 million, and for the half year were up 25% to GBP74.9 million, boosted by the addition of net 31 stores in the half year, bringing its franchised locations portfolio to 173 stores.
The group has also just completed a deal to take control of the agency operation in Germany. Supergroup now has the right to the German market and has acquired seven stores representing a total of 14,000 square feet, all for a total consideration of GBP3.5 million, of which GBP0.7 million will be settled in shares.
"This acquisition allows us to benefit from improved wholesale margins and expand the size and pace of our roll-out programme," Dunkerton said.
"In Europe, opportunity-wise Germany is the most exciting to us, with France a close second. Germany is at the top of our internet growth at the moment," he added.
Dunkerton said that internationally, opportunities in Hong Kong are particularly exciting, given its ability to influence trends in China.
Dunkerton said that the group now sells to around 160 countries worldwide, with e-commerce sales from Europe and the rest of the world, having overtaken those in the UK.
The group said it is well prepared for its peak Christmas trading period, although it said it does not get involved in promotional activity, unlike other clothing retailers.
"We don't really see the madness until the end of November, but we are well prepared," Dunkerton said.
Similar to other traditional retailers, Superdry also jumped on the click-and-collect band wagon, and finally launched such a service five weeks ago, in order to keep up with the change in the way consumers prefer to shop.
"We will also be doing late night deliveries from our new distribution centre, known as The Duke, " Dunkerton said.
The group said its new warehouse operation in Burton-upon-Trent remains on track and on budget. It said it completed it first stock intake, and began dispatches at the beginning of October.
Supergroup said that it remains on track with infrastructure investments, and is looking at a number of future store openings both in the UK and internationally.
"Every channel we have will growth. Our roll-out will continue both at home and abroad, and we continue to expand internationally. We are always in talks with people," said Dunkerton.
Shares in Supergroup were up 6.00 pence Thursday morning at 1,212.00p per share.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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