The owner of Superdry has signed a deal to take the brand into the Chinese market as it expands its global ambitions.
Fashion retailer SuperGroup said it signed a 50/50 joint venture with Chinese rival Trendy International Group that will see both firms invest a combined £18m over at least 10 years.
Chief executive Euan Sutherland called China “a very exciting market”.
He added: “Customer tastes are evolving from luxury brands to brands influenced by ‘pop’ culture and we believe that the Superdry brand, with the right product, pricing model and infrastructure, is well positioned to be successful.”
The move comes as SuperGroup, which runs around 135 stores in the UK and Europe, unveiled full-year underlying profits that edged up two per cent to £63.2m, hampered by last year’s mild autumn weather across the continent, which impacted sales of winter coats and jumpers.
The business, famous for its hoodie tops and T-shirts, said like-for-like sales grew 4.8 per cent in the year to April 25, while it increased its total retail space by 82,000 sq ft, or 13 per cent.
It added that second half sales improved significantly, due to promotional activity and more efficient ordering from suppliers.
The retailer said the first 10 weeks of its current financial year saw it maintain the second half sales growth, with like-for-like sales jumping 20.3 per cent, compared with a 4.9 per cent fall a year earlier, albeit against weaker comparatives.
Last October Mr Sutherland, the former boss at the Co-op, replaced Mr Dunkerton as chief executive, who moved to the newly-created role of product and brand director. The move was aimed at boosting the operational capabilities of the business.
A former rising star of the stock market, the company has been no stranger to profit warnings in recent years.
Last May, it warned that its profit would be at the lower end of expectations because of heavy discounting by rivals, a late Easter and a lack of spring stock.
In March it said it would launch a fashion collection with actor Idris Elba as it steps up its drive to become a global lifestyle brand.
Mr Elba, who is best known for his roles in detective series Luther and The Wire in the United States, will design the range with founder and brand and design director James Holder and will also be the face of the line.
The fashion collaboration with Mr Elba will be ready in time for this year’s autumn/winter collections.