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Struggling Superdry seeks fresh cash with share sale

Superdry CEO Julian Dunkerton (Superdry/PA) (PA Media)
Superdry CEO Julian Dunkerton (Superdry/PA) (PA Media)

Struggling fashion brand Superdry is to sell £15 million worth of shares to provide the cash needed to implement its transformation plans.

Last month, the retailer said it was considering a fundraise as it looks for extra cash to help put a cost-cutting plan in place. The announcement came in a second profit warning of the year, as it blamed cost-of-living pressures for weaker demand.

Superdry said it was “in positive discussions” with investors to raise up to 20% of its current share capital by selling shares. CEOJulian Dunkerton will “significantly participate” in the sale and will underwrite a “material” portion of shares.

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In March, the company sold its Asian IP rights, raising $50 million (£40 million), which it will use to help implement turnaround plans.

Emma Carr, retail partner at Gowling WLG, said Superdry may be able to substanitally cut costs by streamlining its supply of clothes.

“News of this potential equity raise comes on the back of Superdry pledging to make cost savings of £35m by the end of 2024 – which might seem ambitious for some, but for a business with Superdry’s global supply chain footprint and combined expertise, it is perhaps not unrealistic, provided a targeted approach is taken to streamlining its costs,” she said. “Savings could be made by streamlining its stock on the basis of the most popular preferences and do this regionally as well – thereby ensuring that demand is met, whilst also cutting down on the costs of storing surplus stock.

“Likewise, supply chain and logistical contingencies savings could also be made by the brand by forensically examining its supply chain relationships and identifying whether certain suppliers should be removed or replaced in a way that reduces costs – as well as bringing more efficient and valuable supply partners into the process.

“However for such cost savings to be achieved, Superdry will need to be ready to review and adapt to the various strands of its programme as and when necessary if it is to remain on track and target with its ambition.”

Shares are up 0.1p today to 82.2p.