Superdry has been working with PwC advisers to develop restructuring plans, which could include closing stores and cutting rents. The fashion chain is fighting for its survival.
One option could be a Company Voluntary Arrangement (CVA), an insolvency tool controversially used by Julian Dunkerton, the chief executive and founder. CVAs are used to force landlords to accept rent reductions and store closures.
Superdry is trying to negotiate rent reductions with problematic stores. The retailer operates 216 shops, of which 96 are located in the UK. PwC and Superdry declined to comment.
Superdry announced last week that sales fell by 23.5 percent to £219.8 millions in the six-month period ending October 28. The underlying pre-tax losses increased to £25.3million.
Shaun Wills , the company’s finance director, announced his resignation at the end March. He will be replaced by Giles David on a temporary basis. David was previously with McColl’s Retail and Casual Dining Group. Both of these companies went into administration.
Dunkerton & James Holder created the brand in 2003. They caught the public’s attention with their loud designs, faux Japanese, and tie-ins with David Beckham & Idris. Superdry’s peak value was £1.7 billion in 2018.
Dunkerton quit the company that year only to be replaced by Euan Sutherland in 2019, after he became disillusioned about the direction of the brand.
His turnaround efforts were stymied by the pandemic, and inflation surge that left the retailer in a financial bind. Bantry Bay Capital was approached in December 2022 to provide a £80 million loan.
Bantry then set a limit on the amount Superdry could borrow. This forced Dunkerton, as the lender of last recourse for the high street, to obtain a £25million debt facility from Hilco.
Superdry has also sold the rights to its brand across Asia. It is now looking for cost savings of over £40 million. Last Friday, the shares closed at 16,4p and were valued at only £16.3 million. Dunkerton owns 31.8 percent of the shares.
Aldo, a footwear chain, is about to call in administrators. The Bushell Investment Group-owned chain is currently in negotiations with two potential suitors about a possible rescue.