November 8, 2018 / 8:00 AM / 4 days ago

Unseasonal weather clouds Superdry's outlook

(Reuters) - Superdry Plc (SDRY.L), best known for its winter jackets and hoodies, said it was yet to see sustained cold weather across its markets, leading analysts to worry about further risks to the British fashion group’s full-year profits.

FILE PHOTO: A woman walks past a Superdry fashion store in Berlin, Germany, March 17, 2016. REUTERS/Fabrizio Bensch/File Photo

Superdry issued a profit warning last month, joining a growing list of fashion retailers hit by the unusually warm summer and autumn in Britain, continental Europe and the east coast of the United States.

The company’s full-year profits are heavily influenced by its performance in the second half, led by cold-weather clothing with jackets and sweats accounting for 55 to 60 percent of autumn/winter sales.

“While some of our key markets saw colder weather conditions last week, with the result that our sales performance in those markets was more typical for this time of year, we have not yet seen a sustained period of seasonally typical weather,” Superdry said in a statement.

Investec analysts said that without a sustained cold snap, there was potential downside risk to the company’s full-year forecasts.

The company, which has 658 stores in 59 countries, said revenue rose 3.1 percent in the 26 weeks to Oct. 27, with e-commerce revenue rising 6.9 percent and wholesale revenue rising 7.8 percent.

Superdry shares were up 1.5 percent at 869 pence at 0824 GMT.

The company warned in October that continuing warm conditions through September and into the first half of October had significantly affected demand for its autumn and winter range.

The group, which started out with one clothing stall at Cheltenham market, is about six months into an 18-month product diversification programme aimed at reducing its reliance on heavier weight products and winter clothing, such as jackets and sweatshirts.

It plans to sell more dresses, skirts, women’s tops and denim, as well as expand into premium, sports and licensed goods.

Reporting by Tanishaa Nadkar and Arathy S Nair in Bengaluru; Editing by Saumyadeb Chakrabarty and Adrian Croft

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