The owner of Superdry has revealed a 54% leap in half-year profits and reassured over its Christmas trading plans following fears that mild winter weather had forced it to slash prices.
SuperGroup saw shares bounce back by 10%, clawing back some of the 13.5% plunge seen on Tuesday after a broker said unseasonably warm weather and increased competition had seen the retailer launch unplanned promotions to shift stock.
The retailer, which has recently teamed up with Luther and The Wire actor Idris Elba, said underlying profits rose to £19.3 million in the six months to October 24, up from £12.5m a year earlier.
On a bottom line basis, profits fell by a third to £11.5m due in part to start-up losses of its new North American business.
SuperGroup also cut its earnings outlook for the US division, which it expects to remain loss-making until 2017.
But CEO, former Co-op boss Euan Sutherland, hailed a robust first half.
He said: “With a successful first half completed, the business is well placed for the significant peak trading period.”
He added: “Whilst comparatives in the second half are more challenging, the development of Superdry into a global lifestyle brand is proceeding with pace.”
The surge in half-year profits came as SuperGroup delivered a 17% rise in like-for-like retail sales, against a 4.1% fall a year earlier when sales were hit by a mild autumn.
But there are signs that a mild winter so far this year is forcing retailers into heavy discounting, with official inflation figures on Tuesday showing a record fall in clothing and footwear prices last month.