The City had been getting nervous recently that SuperGroup was starting to lose momentum; to become a bit over-exposed. But actually, today’s results indicate that its aggressive expansion strategy is working really rather well. The Cheltenham-based group, which also owns the 77Breed and SurfCo California brands, says it opened 20 new stores last year. And its ambitions don’t end there: last month, it said it was planning to open 50 international stores over the next year. It’s also supposedly poised to take over Austin Reed’s Regent Street store in a deal worth £12m (the first change in occupancy for that premises in about a century).
Trading figures like these will have come as a relief to SuperGroup founder Julian Dunkerton – an MT Top 100 Entrepreneurs alumnus – who, having floated his company last year at £5 per share, watched its price rise to nearly £18, but then crash like Superman on kryptonite following (relatively) lacklustre growth. The good news, though, is that today’s results pushed the share price up by a very respectable 132p to £10.06.
But SuperGroup isn’t the only one flying the flag (cape?) for British business abroad. Luxury goods brand Burberry has also released encouraging figures this morning: revenues rose 34% in the three months to June 30, to £367m – well above the City’s £340m forecast. The brand put it down to higher-than-expected ‘in-season’ orders, which it said would push up wholesale revenue excluding China by a ‘high teens percentage’. It’s another sign that while many retailers are still struggling, the luxury market is faring relatively well. That’s a lot to do with success in emerging markets, where the newly-wealthy middle classes value brands like Burberry for their heritage status.
SuperGroup might have a while to wait before it’s considered heritage – but if its expansion strategy continues to go as well as this, it’s only a matter of time before the young men of the Chinese middle classes are tucking their jeans into their boots with the best of them…