UK fashion group Superdry has today reported a wider first-half loss and another big drop in sales in the Christmas quarter, hurt by Covid-19 lockdowns that have closed its stores.
The company, best known for its sweatshirts, hoodies, jackets and coats, made an underlying pretax loss of £10.6m in the six months to October 24, compared to a loss of £2.3m the same time in 2019.
First-half revenue slumped 23.3% to £282.7m and was down 27.2% in the 11 weeks to January 9.
Superdry said 23% of owned store trading days were lost in the first half and 38% in the latest quarter due to lockdown restrictions and the continued impact of social distancing on footfall even when open.
As of January 9, 173 stores were temporarily closed, representing 72% of its estate.
Most Superdry stores are in major city centres and retail sites, locations most impacted by the pandemic in terms of shopper numbers. So it has suffered even when its stores have been open.
It said e-commerce sales partially offset lost store sales, accounting for half of its retail revenue in the first half.
The group, whose shares have fallen by more than 40% over the last year, said it was more difficult than ever to forecast for the full 2020-21 year.
"We recognise the material uncertainty noted in our going concern assessment, and we are not providing formal guidance at this time for FY21 or beyond," it said, adding it had net cash of £54.8m.
Meanwhile, Superdry said it will use bonded warehouses to avoid having to pay tariffs on product re-exported to the European Union.
UK retailers, including Marks & Spencer and ASOS, have complained of issues re-exporting goods to EU countries since the end of the Brexit transition period on December 31, with tariffs imposed on items not made in the UK.
Superdry CEO Julian Dunkerton said the firm was well placed because most of the product it sold in Europe was shipped from suppliers directly to its warehouse in Belgium.
"We are one of the best prepared and the least affected," he told Reuters.
He said that for product not sent direct to Europe the group will utilise bonded warehouses.
Tariffs do not need to be paid when goods are moved between the bonded warehouses.
"We'll be bonded by April, both in Europe and the UK," Dunkerton said, pointing out that about 40% of its sales were made in Europe.