Branded fashion retailer SuperGroup (SGP) struts 7.1% higher to £10.68 on news of a better-than-expected fourth quarter. CEO Euan Sutherland also pleases with a positive strategy update, highlighting ongoing extension of the Superdry brand's global reach.
You can read SuperGroup's latest market missive in full here. Perhaps the key takeaway is the positive trend seen over Christmas continued into the final quarter, with sales up 18.4% to £134.8 million over the 15 weeks to 25 April. This included a second quarter of double digit retail like-for-like sales growth, up 11.6% to mark the beginning of a more positive trend.
Cheltenham-headquartered SuperGroup also flags 9.7% growth in Q4 wholesale revenues, an acceleration on Q3 delivered despite the loss of a key customer and sterling's strengthening versus the euro, and assures full-year pre-tax profit will be in-line with the previously-guided £60-65 million range.
SuperGroup's share price has proved volatile, not helped by another profit warning (31 Oct 2014), chief operating officer Susanne Given's resignation (12 Feb), then the departure of numbers man Shaun Wills, forced to step down over a personal bankruptcy order. However it has started to recover following a well-received strategy overhaul in March, where Sutherland set out plans to drive long-term growth and develop Superdry into a global lifestyle brand.
This contained news of the buy-out of SuperGroup's US license and of a premium clothing line collaboration with actor Idris Elba. The cash-rich retailer also said it would start paying dividends in the year to April 2016, a likelihood Shares flagged here in February. Today, Sutherland pleases by flagging the ongoing extension of the Superdry brand's reach, as the owned and franchised store expansion drive continues and the e-commerce business 'continues to strengthen'. Indeed, web-based sales grew the best part of 40% last year.
Following today's update, Cantor Fitzgerald's Freddie George sticks with his 'top end of the range' £63.5 million pre-tax profit forecast, with a £68.5 million PBT haul shaded in for April 2016. Investec Securities' Kate Calvert reiterates her 'buy' rating, arguing 'SuperGroup's global growth opportunities continue to be undervalued' and seeing 'material opportunity to improve UK efficiency and profitability in the short-term'.