Retailer’s sales strong despite share price slump

After floating at 500p 15 months ago, SuperGroup’s shares soared to 1,899p in February as it reported a series of stellar sales figures.

But results for the three months to May 1 showed sales growth slowing to 61 per cent from 87 per cent the quarter before, prompting a dramatic reversal in its shares which closed at 900p on Friday. Last night they closed down 37p at 863p.

SuperGroup, which opened its largest Superdry store in Sheffield’s Meadowhall shopping centre last year and has sites in Leeds and Hull, said it has exchanged contracts for a new flagship store on London’s Regent Street.

The group, which also owns the Cult and SurfCo California brands, also said it plans to open 20 outlets in the UK this year.

SuperGroup recently admitted that it did not bring out its summer ranges in time to take advantage of warm spring weather, while some analysts fear that its brand may be overexposed.

The group said trading has seen a marked improvement over the past three weeks, complemented by strong growth in sales of its brands to other retailers.

It currently has 61 stores in the UK, but believes there is capacity to open as many as 150.

The group also said it is on track to grow its internet sales to 20 per cent of its turnover from eight per cent currently as it looks to tap overseas markets.

The company said that trading in the new financial year starting in May is in line with the previous quarter, when retail sales increased by 39 per cent.

Sales picked up in the June, suggesting that May had seen a weaker performance.

Nick Bubb, retail analyst at Arden Partners, said he was impressed with SuperGroup’s plans and said that the shares have dropped to an “absurd” level, after almost halving in value since February.

He added that they could double in price as quickly as they fell if the group meets its potential.