LONDON (Alliance News) - Shares in fashion retailer SuperGroup PLC shot to the top of the FTSE 250 on Thursday after it posted growth in total and like-for-like revenue in its recently-ended financial year, with a particularly strong performance in the fourth quarter, as one of its founders stepped down to lead a design consultancy.
Shares in Supergroup were trading up 13% at 1,420.00 pence at midday Thursday, the best performer in the FTSE 250.
The owner of the Superdry brand said total group revenue for the year to April 23 was GBP589.5 million, up 21% year-on-year from GBP486.6 million. Total retail revenue grew by 25% over the year to GBP416.1 million from GBP334.1 million, and by 30% in the fourth quarter.
Like-for-like sales growth, meanwhile, hit 11%, well ahead of the 4.8% like-for-like growth posted for the prior financial year. Like-for-like sales growth in the fourth quarter was even stronger, at 15%.
Cantor Fitzgerald analyst Freddie George said SuperGroup's results were "significantly better" than its forecasts. The broker had forecast fourth-quarter retail sales growth of 15% and fourth-quarter like-for-like sales growth of only 2%.
SuperGroup said sales had been boosted by continued growth in e-commerce sales and initial benefits from its new sportswear and premium product ranges.
Wholesale revenue, meanwhile, grew by 14% to GBP173.4 million from GBP152.5 million, benefiting from a strong second half performance with strong in-season sales plus the opening of 48 net franchised stores.
"These figures confirm that the company is very much in a growth phase," Cantor's George said.
The company said it expects margin growth for the year to be at the top end of its expectation for 40-60 basis point accretion, while pretax profit is expected to be in the range of GBP72.5 million and GBP74.0 million.
SuperGroup's pretax profit in the prior financial year was GBP59.5 million on a reported basis and GBP63.2 million on an underlying basis.
The company said progress in North America and China continues in line with its plans and initial losses in those markets will be in line with market guidance, leading to a small year-on-year dilution of operating margin.
In March, SuperGroup acquired the distribution rights to the Superdry brand in North America as part of a push to bring the ownership of the brand fully in-house. The one-off costs related to this brought profit down in the first half of the year, when, in December, the group warned that the full-year loss in North America would be wider than previously thought following the buy-out.
In China, SuperGroup entered a joint venture with Chinese fashion retailer Trendy International Group last July, in order to break into the Chinese market.
SuperGroup added 136,000 square feet to its store estate through its store expansion programme in the year, representing year-on-year space growth of 18%. Of this, 24 net new stores were opened across Europe, and SuperGroup said it has a strong pipeline of new stores for the current financial year.
SuperGroup also plans to open two distribution centres during 2016 to better serve its retail customers in Europe and North America and to ensure it has a scalable platform to support its growth ambitions, SuperGroup said.
"The group has traded robustly throughout the final quarter, as we continue to deliver our strategy to create a global lifestyle brand," said Chief Executive Euan Sutherland.
"During the quarter the group paid its first dividend in line with our progressive dividend policy whilst retaining sufficient capital to support our investment programme. Our focus remains on the extension of the Superdry brand and execution of clear growth opportunities, under-pinned by continued investment in infrastructure to strengthen our business," he added.
In a separate statement, SuperGroup said that James Holder, a founder of the business and currently its brand and design director, will now lead the SuperDesign Lab consultancy as a "design hot house" to drive product innovation exclusively for SuperGroup. As a result of this, Holder will step down as a director and employee of SuperGroup.
Holder will step down from June 1, after which the heads of design for the menswear and womenswear divisions will report directly to CEO Sutherland.
By Karolina Kaminska; karolinakaminska@alliancenews.com @KarolinaAllNews
Copyright 2016 Alliance News Limited. All Rights Reserved.
