- Retailer in talks with turnaround specialist Hilco amid weak demand
Superdry is seeking an additional £20m of liquidity from a key lender, as the fashion brand struggles to implement a recovery plan amid weak demand.
The group told shareholders on Tuesday it was in talks with restructuring specialist Hilco about an increase to its credit facilities of “approximately” £10 million for “the additional liquidity headroom needed to help facilitate the implementation of its plan.” restructuring process and its cost reduction program.
Superdry is also seeking an additional £10m to “assist with seasonal peaks in working capital” and a six-month extension to the due date of its existing facilities with Hilco until February next year.
Superdry seeks liquidity boost with expansion of its credit lines
The debt, if a deal is reached, will be added to a £25m emergency loan agreed with Hilco in 2023, on which Superdry will pay an interest rate of 10.5 per cent plus the base rate. Superdry also has an £80 million facility with Bantry Bay Capital.
superdry stock fell 6.2 per cent to 29 pence in early trading, taking losses over the past 12 months to around 74 per cent.
The retailer, which employs around 3,350 people worldwide and operates 216 stores along with franchise stores, has faced trading difficulties in recent years. It has recorded just one year of profitability since 2020.
Its finance chief, Shaun Wills, resigned at the end of March after the group posted an adjusted pre-tax loss of £25.3m for the six months to October 28, down from a loss of £13m. .6 million pounds last year.
Superdry, known for the Japanese graphics on its T-shirts and hoodies, saw its revenue fall 23.5 per cent to £219.8 million during the period.
The group has been studying various “cost-saving options” amid reports it has been considering a restructuring. This could include store closures and job cuts.
Chief executive and main investor Julian Dunkerton is currently weighing up options for Superdry, which could lead to him making a cash offer for the shares he does not already own.
Superdry shares received a rare boost in late February when it emerged that New York investment management firm Davidson Kempner is in talks with Dunkerton about backing a deal to take the brand private.
The talks are understood to be at a “preliminary stage” and there is no guarantee of an agreement.
