12th Dec 2018 08:40
LONDON (Alliance News) - Shares in fashion brand Superdry PLC dropped a third Wednesday after underlying profit halved amid tough market conditions and internal challenges, though the retailer held its interim dividend flat.
Shares in FTSE 250-listed Superdry were 33% lower at 384.20 pence on Wednesday.
For the six months ended October 27, reported pretax profit nearly tripled to GBP26.4 million from GBP9.1 million a year prior. This was as revenue rose 3.1% to GBP414.6 million from GBP402.0 million a year before.
Profit performance was helped by a sharp reversal in exceptional items during the period to a GBP13.5 million gain from a GBP16.2 million charge a year prior. This was primarily related to a reversal in unrealised gains and losses associated with their financial derivatives.
On an underlying basis - excluding exceptional costs - pretax profit halved to GBP12.9 million from GBP25.3 million a year before.
"Superdry had a difficult first half, impacted by unseasonably warm weather across our major markets, a consumer economy that is increasingly discount driven and the issues we are addressing in product mix and range," Superdry Chief Executive Officer Euan Sutherland said.
"Superdry is a strong brand and has strong operational capabilities," Sutherland added. "We are focused on an intensified transformation programme to reset the business and address the legacy issues we face, particularly in product mix and range."
Superdry proposed a 9.3 pence per share interim dividend, flat on a year prior.
"Superdry is responding to its internal challenges as well as a changing world and changing consumers," Sutherland continued. "Our comprehensive transformation will ensure Superdry is well positioned as we optimise our routes to market and make our business more efficient."
"We are confident that our transformation programme combined with the underlying operational strengths of the business will deliver a return to higher levels of growth and profitability while realising geographic expansion opportunities and leveraging our multi-channel operating model to serve customers in whichever way suits them best", Sutherland concluded.
Superdry said it expects underlying pretax profit in a range of GBP55 million to GBP70 million for the full-year, reflecting "considerable uncertainty" in the weather outlook, changing consumer behaviour and wider economic and political uncertainty. For the firm's previous financial year, underlying pretax profit came in at GBP97.0 million
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