Niche stores defying high street gloom

Fast-growing Superdry, which counts celebrities such as David Beckham, Leonardo DiCaprio and Zac Efron among its customers, said sales growth accelerated in its first quarter after stalling in the spring.

The chain, which is owned by parent company SuperGroup, said total sales rose 66 per cent to £54m in the 13 weeks to July 31, up from 61 per cent and 87 per cent in the previous two quarters.

Sports Direct, the UK’s biggest sporting goods retailer, also reported higher sales in the 13 weeks to July 25, despite tough comparisons with last year when the World Cup pulled in shoppers.

The company said it would meet annual profit targets despite having to pay out a £2m success fee to golfer Darren Clarke for winning The Open Championship in July. Mr Clarke wears the firm’s Dunlop brand.

Sports Direct, controlled by Newcastle United soccer club owner Mike Ashley, said it is on track to meet its 2011-12 target for underlying earnings before tax, interest, depreciation and amortisation of £215m before staff bonus scheme costs.

In contrast, there was more woe for retailer Dixons as the PC World and Currys owner posted a slump in sales in the first quarter of its financial year.

The group reported a 10 per cent fall in same-store sales during the 12 weeks to July 23 in the UK and Ireland and a seven per cent drop across the whole group.

Dixons said the quarter was up against particularly strong trading in the same period last year as a result of the World Cup and the launch of Apple’s iPad.

The figures will do nothing to alleviate concerns over the state of traditional high street retailers. A number of long-standing store groups from interior designer Habitat to fashion chain Jane Norman have fallen into administration.

But at newcomer SuperGroup, directors displayed their confidence in the business by promising not to sell shares when their lock-ups expire.

The group’s chief executive Julian Dunkerton said: “We have all indicated that we will not be selling,” referring to the director lock-ups that were put in place when SuperGroup floated in March 2010. The lock-ups expire on September 24. First-quarter retail sales of the firm’s trademark T-shirts, hooded tops, check shirts and jogging bottoms rose 51 per cent to £34m.

Mr Dunkerton said the first signs for autumn trading are “very positive”, with new ranges of knitwear, jackets and accessories particularly well received.

SuperGroup, which opened its largest Superdry store in Sheffield’s Meadowhall shopping centre last year and has sites in Leeds and Hull, said store roll-out plans are on track.

Sports Direct opened nine stores in the 13 weeks to July 25 – offset by two closures and two shop relocations.

Across the Sports Direct group, which has 350 UK stores as well as owning sporting brands Dunlop, Karrimor and Slazenger, sales rose 0.5 per cent to £410m. Profits fell 5.7 per cent to £174m.

Chief executive Dave Forsey said the summer’s trading keeps the company on course to meet its full-year target for underlying earnings of £215m. This factors in the £2m paid to golfer Darren Clarke.

Staff will benefit from bonuses if the company is successful in delivering on the £215m figure in the year to April. Around 2,000 staff have already received average share payouts worth more than £40,000.

The bonus scheme is seen as a key factor in the chain’s improved performance over the past two years.

Nick Bubb, retail analyst at Arden Partners, said the company continued to “run rings” around rival JJB Sports, while Panmure Gordon’s Nick Dorgan praised the firm for a decent set of figures.

But at Dixons, the news was not so rosy. Europe’s second-biggest electricals retailer is cutting costs and trimming investment plans to counter a drop in sales and profit margins as shoppers rein in spending.

The group said it would cut an extra £10m of costs and limit capital spending to £100m instead of the original £110m-£160m expenditure.

Big ticket items are suffering

Shoppers are slashing spending on discretionary items such as electricals goods as they grapple with rising prices, wage concerns and austerity measures.

Retail sales fell last month as cash-strapped consumers bought fewer non-essential items such as homewares and furniture, according to the British Retail Consortium. Retail sales values were 0.6 per cent lower on a like-for-like basis compared to August 2010.

The BRC’s director general Stephen Robertson said: “Poor consumer confidence, high inflation and the on-going squeeze on personal finances remain the biggest threats to the retail sector. Sales of big-ticket items are very dependent on discounting.”