Struggling Superdry considers major restructuring across business
Gloucestershire retailer is considering a major restructuring as it battles for survival – according to widespread reports.
The retailer has been hit by rising debts and a slump in sale and this week announced a 35 per cent slump in sales and the departure of its chief finance officer.
According to reports the Cheltenham firm is considering a radical restructuring which would involve store closures and job cuts.
Sky News is reporting that Superdry and its advisers at PwC are working on plans that could lead to a company voluntary arrangement (CVA) or restructuring plan.
Superdry issued a statement this morning on the situation.
It said: “Superdry notes the recent press speculation. In line with the company’s turnaround strategy, the company confirms it is working with advisors to explore the feasibility of various material cost saving options. Whilst there is no certainty that any of these options are progressed, they aim to build on the success of the cost saving initiatives carried out by the company to date and position the business for long-term success.
“As set out in the company’s H1 FY24 results last week, the company has continued to prioritise driving forward its cost reduction agenda. It is set to deliver in excess of £40m in savings this financial year, ahead of the initially stated target of £35m, with more than £20m of those savings already achieved in H1.”
Currently the company employs 3,350 staff and has more than 215 stores.
Founded by Julian Dunkerton, the chain has endured a torrid few years punctuated by capital-raisings and brand licensing deals aimed at raising cash.
Following Friday’s market update the shares crashed even further, ending on Friday at 16.44p leaving the firm with a market capitalisation of just £16m.
“The consumer retail market remains challenging and unpredictable, and sales performance has not been helped by the extreme weather events of the summer being followed by one of the warmest autumn seasons on record, which persisted through the peak Christmas trading period,” Superdry said in its trading update.
“We are mindful of these external and macro factors and as outlined as part of our December trading statement we expect full year profitability to be impacted by the weaker trading we have seen to-date, and internal expectations remain consistent with that view.
“As a management team, we continue to focus on the delivery of our cost efficiency programme and further opportunities to reduce the fixed cost base of the business, with in excess of £40m of savings due to be realised within the year.”
Superdry already has debt facilities available to it, through arrangements with Hilco and Bantry Bay Capital worth a total of more than £100m.
Just under a year ago, Superdry appointed Interpath Advisory to draw up cost-cutting plans across the business.
