Struggling Superdry extends its loan facilities as it battles against rising debt
Struggling fashion firm Superdry has extending its funding agreements as it battles to balance its books.
The Cheltenham firm, which was founded by Julian Dunkerton recently issued a profits warning and revealed it was looking to make £35m worth of cuts.
The company has also sold the rights to its brand in Asia for £34m. The company has announced it is extending its loan agreements while it waits for the deal to complete.
A statement on the London Stock Market said: “Further to the company’s announcement on 14 April 2023, Superdry today announces the agreement of amendments to its financing facility, pursuant to which its lender, Bantry Bay, has agreed to increase the borrowing availability level under its asset-backed facility until completion of the previously announced sale of the APAC business.
“The company currently has in place an asset-backed loan of up to £80m. The borrowing availability levels under the asset-backed facility is determined by the company’s asset base, which is currently reduced on account of a seasonal low in the company’s working capital cycle, alongside the previously reported weaker performance of the wholesale division. As at close of business 24 April, the company’s net debt position is circa £26m.”
Superdry is considering an equity raise of up to 20 per cent of its share capital in further efforts to cope with a fall in demand and issues with its wholesale business.
Julian Dunkerton said he would use a part of his personal £400m fortune to take part in the fundraising.
He said: “The Superdry brand continues to evolve but there is no doubt that the market conditions we face are challenging, compounded by the issues we have previously disclosed and are working to address in wholesale.
“As a result, while we continue to deliver like-for-like growth in retail sales, we need to ensure our business is in the right shape to navigate these difficult times, which is why we are looking hard at our cost base.
“My belief in the Superdry brand is stronger than ever which is why I’m prepared to provide material support to any equity raise undertaken.
“I am confident that we have the right plan and, working together as a team, the business will emerge from the current turbulence stronger than ever.”
