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Superdry (SDRY) share price: annual results preview

Superdry (SDRY) share price: annual results preview

The Superdry share price fell like a stone last year as management came under fire from co-founder Julian Dunkerton for their stewardship of the company, and 2019 has not been much better for the clothing retailer. 

Superdry’s full-year results are released at 7am on Wednesday 10 July, after the release was postponed from 4 July. Will the numbers help the share price move in the right direction, or will they add to the company’s woes?

Superdry share price: a tough 2018 

By mid-December last year, when the company’s first-half numbers came out, the Superdry (SDRY) share price was already down 70% for the year, and the half-year numbers failed to overcome the already low expectations at the time. The day before the numbers were released, brokers Berenberg downgraded their estimates for 2019-2021, saying the company’s reliance on winter clothing didn’t bode well for profits, especially considering the fact that they had already announced a profit warning in October 2018 – since then there have been two more profit warnings, in December 2018 and May 2019. 

The Superdry share price did manage to find a base at the end of last year though, and since then it has broadly stabilised and traded sideways, with the return of Mr Dunkerton raising hopes that he can turn the business around.

Dunkerton’s comeback

The co-founder’s comeback campaign reached a critical point in December when Mr Dunkerton called on shareholders to support him, saying he needed to be back running the business within weeks in order to turn it around by Christmas 2019. He said: “This has to be the moment where we say enough is enough. We are now at the position where we have to act. The numbers are there and everyone can see I was right.” 

In April 2019, the Superdry (SDRY) share price took another knock when Mr Dunkerton’s campaign succeeded as shareholders narrowly allowed his return to the board. The vote prompted a mass exodus, ultimately leading to the resignation of eight board members in total.

Superdry share price: impact of third profit warning

On 9 May this year, the company issued its third profit warning in 12 months. While Superdry shares experienced a sharp sell-off on the open, the stock rebounded later in the day. In the year to 27 April, Superdry’s wholesale revenue rose 3.6%; however, a poor Q4 undermined hopes of a much better performance overall. Online sales were also disappointing, rising a meagre 1.6%, which is particularly concerning with the rise in e-commerce in recent years.

Against such a weak backdrop, investors will want to know how Mr Dunkerton intends to turn the business around and help the Superdry share price recover, in what is becoming an ever-tougher environment for clothing retailers. With the full-year results coming out on Wednesday, it will be interesting to see whether the numbers will help to restore shareholder confidence or not. 

Dunkerton has said "All of us in the business are putting all our energy into getting the product ranges right and improving the e-commerce proposition, which are two important steps towards addressing Superdry's recent weak performance. The impact of the changes we are making will take time to come through in the numbers but I'm confident we are heading in the right direction."

While his words convey the right positive sentiment, he certainly has his work cut out for him when it comes to turning the company’s fortunes around and getting the Superdry share price on the right trajectory again. 

Update: The reuslts are out. Read our analysis on the figures and the early impact on the Superdry share price.



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