SuperGroup PLC Full Year Pre-Close Trading Statement (7905E)

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RNS Number : 7905E

SuperGroup PLC

11 May 2017

SuperGroup<Plc

Full Year Pre-close Trading Statement

A further year of brand and strategy progress; Profit in line with market expectation

11 May 2017

SuperGroup Plc ('SuperGroup' or 'Group'), the owner of the Superdry brand, today provides a trading update covering the 16-weeks from 8 January 2017 (the 'quarter'), the 26 week (the 'half year') and 52 week (the 'full year') periods ended 29 April 2017.

Revenue

 
 GBPm                              Q4                            H2                      Full Year 
-------------------  ------------------------------  --------------------------  ------------------------- 
                       FY17       FY16      Growth     FY17     FY16    Growth    FY17    FY16**   Growth 
-------------------  --------  ----------  --------  --------  ------  --------  ------  -------  -------- 
 Group revenues(*)                                     416.6    335.4    24.2%    750.6   590.1     27.2% 
-------------------  --------  ----------  --------  --------  ------  --------  ------  -------  -------- 
 
 Retail revenue        124.3      109.4      13.6%     286.4    243.8    17.5%    501.6   415.9     20.6% 
-------------------  --------  ----------  --------  --------  ------  --------  ------  -------  -------- 
 Retail LFL(1) 
  (%)                  9.4%     15.4%(1c)              12.5%    8.0%              12.7%   11.3% 
-------------------  --------  ----------  --------  --------  ------  --------  ------  -------  -------- 
 Average 
  space ('000's 
  sq ft)                1,035       889       16.4%     1,028     886     16.0%     983     837      17.4% 
-------------------  --------  ----------  --------  --------  ------  --------  ------  -------  -------- 
 
 Wholesale 
  revenue(*)                                           130.2    91.6     42.1%    248.9   174.2     42.9% 
-------------------  --------  ----------  --------  --------  ------  --------  ------  -------  -------- 
 *Wholesale revenues are reported at the half and full 
  year only. 
  ** 52 weeks 
---------------------------------------------------------------------------------------------------------- 
 

Group revenues for the full year increased by 27.2% to GBP750.6m. As reported at the half year results the brand's global footprint has led to revenues benefitting from sterling's weakness. The impact of currency changes continued to account for approximately one third of the reported growth in each of the Group's sales channels.

Within Retail, the strong positive sales momentum has been maintained throughout the fourth quarter, delivering LFL sales of 9.4% with positive LFL sales in each of the Group's sales channels. Full year like-for-like growth of 12.7% benefitted from the continuing growth of Group's differentiated e-commerce channel which delivered year-on-year growth of c.35%.

Wholesale revenue maintained the levels of growth delivered in the first half year, growing on a full year basis by 42.9%. This performance reflects the benefit from the Group's renewed focus on this channel with improved service levels driving sales with existing customers and franchise expansion and product innovation introducing new customers to the Superdry brand.

Gross margin

In line with guidance, gross margin performance across the Group's sales channels have been broadly flat year on year across the second half. This performance has been offset by the adverse impact of foreign exchange and the strength of Wholesale growth, being faster than Retail, resulting in a dilutive mix impact. Accordingly, Group level gross margins are anticipated to decline on a full year basis in the range of 120 bps to 140 bps.

Strategic progress

The year closed with 555 Superdry branded store locations(2) (FY16: 475) having passed the milestone of operating 1 million sq. ft. of owned trading space during the second half. During the quarter the Group opened 26 new stores of which 6 were owned and 20 franchised. The net addition in the quarter of 27,000 square feet to the owned store portfolio increased the brand's average retail space by 16%, and by 17% on a full year basis.

The on-going programme to develop regional distribution facilities in Europe and the USA to complement the Group's capability in the UK remains on track. The dual running and other mitigation costs in FY17 remain in line with guidance at c. GBP2m.

The Group's development markets of North America and China, have continued to perform in line with their respective plans. In the USA the benefit of continued strong e-commerce growth, improving store LFL performances and an encouraging new store performance has led to a break-even position being achieved for FY17, in line with guidance.

Underlying(3) Profit before Taxation

The Board anticipates that full year profit will be in the range of GBP86m - GBP87m in line with market expectation(4.)

Euan Sutherland, Chief Executive Officer, said:

"We remain focused on the consistent execution of the strategy outlined in early 2015. This global multi-channel growth strategy balances opening stores, developing new wholesale partners and driving our strong e-commerce proposition to expand the reach of the brand and further diversify our business model.

"FY17 has seen another good year of sales and profit growth. This has been achieved by improving our product ranges and introducing new categories to excite, inspire and maintain the brand's relevance while, in parallel, investing in our development markets and improving our infrastructure. With a clear strategy and a number of long term opportunities to establish Superdry as a global lifestyle brand we remain confident in the continued delivery of sustainable revenue and profit growth."

For further information:

 
 
 SuperGroup 
 Nick Wharton                  [phone] 
 Chief Financial Officer       [e-mail] 
 
 Tony Newbould                 [phone] 
 Head of Investor Relations    [e-mail] 
 
 Tulchan 
 Susanna Voyle                 [phone] 
 Sam Chiene                    [e-mail] 
 

Conference call

SuperGroup will be hosting a conference call for analysts and institutional investors at 08:30 hours today. A recording of the conference call will be available on www.supergroup.co.uk

   Dial in:    UK Toll Number:                 0203 139 4830 
                   UK Toll-Free Number:        0808 237 0030 
   Pin:         48144749# 

Announcement of FY17 Preliminary Results

SuperGroup will announce its Preliminary Results for the 52 weeks ended 29 April 2017 on Thursday 6 July 2017

Notes

1. Like-for-like sales ('LFL') growth is defined as the year-on-year sales growth for stores and concessions open for more than one year and include e-commerce revenues. Foreign currency sales are translated at the average rate for the month in which they were made.

 
  Reported                   Q1                       Q2                            Q3 
-----------------  ----------------------  -----------------------  --------------------------------- 
 
 GBPm               FY17    FY16    FY17    FY17    FY16    Growth     FY17(a)     FY16(b)     Growth 
 Total retail       100.6   80.6    24.8%   114.6   91.5    25.1%      162.1       134.4      20.6% 
 LFL(1)             11.9%   19.3%           13.7%   15.5%              14.9%      1.2%(c) 
 Ave. Space 
  (sq. '000s)(2)     920     773    19.0%    957     805    18.9%      1,021        882       15.8% 
-----------------  ------  ------  ------  ------  ------  -------  ----------  ----------  --------- 
 

Notes:

a. 10 weeks to 7 January 2017

b. 10 weeks to 9 January 2016

c. Reported LFL

   2.     Retail Space Analysis: 
 
                    Closing                                       FY17 Q3          FY17 Q4 
                      FY16         FY17 Q1        FY17 Q2 
---------------  -------------  -------------  -------------  ---------------  --------------- 
                  Sq             Sq             Sq             Sq.ft   Stores   Sq.ft   Stores 
                   ft   Stores    ft   Stores    ft   Stores 
---------------  ----  -------  ----  -------  ----  -------  ------  -------  ------  ------- 
 Owned stores 
---------------  ----  -------  ----  -------  ----  -------  ------  -------  ------  ------- 
 UK & ROI         570      100   570      100   570      100     561       98     573       99 
---------------  ----  -------  ----  -------  ----  -------  ------  -------  ------  ------- 
 EU               281       87   296       89   332       93     392       98     405      101 
---------------  ----  -------  ----  -------  ----  -------  ------  -------  ------  ------- 
 North America     49       15    65       17    65       17      74       19      76       20 
---------------  ----  -------  ----  -------  ----  -------  ------  -------  ------  ------- 
 Group            900      202   931      206   967      210   1,027      215   1,054      220 
 Franchise 
  stores                   260            271            289              299              319 
 License 
  stores                    13             14             15               16               16 
---------------  ----  -------  ----  -------  ----  -------  ------  -------  ------  ------- 
 Total Stores              475            491            514              530              555 
---------------  ----  -------  ----  -------  ----  -------  ------  -------  ------  ------- 
 

The Group opened 24 stores, relocated 3 stores and 6 stores were closed during the year.

3. Underlying is defined as reported results adjusted to reflect the impact of the loss/gain recognised on re-measurements (being the fair valuation of financial derivatives), exceptional items and, when appropriate, the related income tax. The Directors believe that the underlying results provide additional guidance to statutory measures to help understand the performance of the Group.

4. The Board considers market expectations for the financial year ended 29 April 2017 are best defined by taking the range of forecasts of PBT published by analysts who consistently follow the Group. The current consensus of PBT forecasts as at 10 May 2017, of which the Board is aware, is GBP86.2m.

Notes to Editors

SuperGroup is the owner of British lifestyle brand Superdry. A brand designed for attitude not age with affordable, premium-quality clothing, accessories, footwear and cosmetics.

As we develop the breadth and nature of our product range, we continue to appeal to a much broader, aspirational age group. Those who want to feel amazing in what they wear and appreciate style, quality and attention to detail.

Already well established in the UK - our home market - we operate a significant and continually expanding international business, selling through our websites, wholesale partners, a network of franchise stores and, increasingly, our independent stores. We are becoming a more efficient business as we improve our process from design to customer and refine our wholesale model. Simultaneously, we are focused on expanding our business globally, and we have a clear strategy for growing our e-commerce business as well as Europe, North America and China.

The Group has a physical presence in 62 countries through 863 stores and concessions globally. We also have a successful e-commerce business with 27 international websites across 18 countries covering 12 different languages.

Cautionary Statement

This announcement contains certain forward-looking statements with respect to the financial condition and operational results of SuperGroup Plc. These statements and forecasts involve risk, uncertainty and assumptions because they relate to events and depend upon circumstances that will occur in the future. There are a number of factors that could cause actual results or developments to differ materially from those expressed or implied by these forward-looking statements. These forward-looking statements are made only as at the date of this announcement. Nothing in this announcement should be construed as a profit forecast. Except as required by law, SuperGroup Plc has no obligation to update the forward-looking statements or to correct any inaccuracies therein.

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

This information is provided by RNS

The company news service from the London Stock Exchange

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May 11, 2017 02:00 ET (06:00 GMT)