Youth fashion retailer Supergroup has today announced “disappointing” figures for its full year trading period.
Underlying pre-tax profit at the group, which owns Superdry and Cult, plummeted 14.7 per cent in the 52 weeks to April 29th 2012 while underlying operating profit fell 16.1 per cent to £31.7 million.
Group revenue grew 31.9 per cent while group profit before tax increased 8.7 per cent.
Online sales have performed strongly over the period and now account for 10 per cent of total revenue, while UK like-for-like sales including internet sales rose two per cent over the period.
While these results appear positive Neil Saunders, Managing Director of analyst firm Conlumino, explained the importance of putting the figures into context.
“At the headline level, growth at SuperGroup looks impressive,” he said.
“However, on balance this has not been a good year for the company and is probably one it would rather forget.
“UK like-for-like retail sales are relatively weak coming it at just 2 per cent for the full year. This is a long way below total growth in the clothing market and as it includes online sales is an anaemic performance.
“While some of this may be attributed to earlier operational issues, some is also probably down to cannibalisation as the brand becomes more widely available.”
Throughout the financial year, the retailer has been plagued with stock management and distribution errors and such events have adversely affected profit.
Supergroup Chairman Peter Bamford, admitted that the year has been a challenging one.
“The last year has clearly been a difficult one for SuperGroup,” he conceded.
“We have delivered a strong performance in Group revenues, but profits have fallen considerably short of expectations. Whilst the tough and volatile economic environment has not helped, our problems have been largely self-inflicted.
“Clearly, keeping pace with this level of growth would always have been a challenge, but we should have done better.”
Earlier in the year, the retailer focused efforts on strengthening its management team, poaching John Lewis’ then Director of Fashion & Beauty Suzanne Given to work in the newly-created role of Chief Operating Officer.
Changes to the executive team have allowed for a more disciplined approach, Bamford believes and will enable the brand to manage its growth realise its full potential.
“I would like to thank everyone who works for SuperGroup for their continued hard work and commitment during this difficult and, at times, stressful year,” Bamford said.
“I am optimistic that the changes we are making will ensure that our SuperGroup remains a fulfilling and enjoyable place to work as well as delivering financial performance which is in line with the expectations of our investors.