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Super Sales Growth Of 21% For Supergroup PLC

The shares of Supergroup (LSE: SGP) dropped 3% to 1,215p during early London trade this morning as investors took profits following impressive half-yearly results.

Supergroup, which owns the SuperDry fashion brand, delivered like-for-like sales growth of more than 8% to £192m. The opening of 43 new stores (35 franchised internationally) meanwhile saw total sales boosted by 21%.

Total online sales climbed by 19% to reach 11% of Supergroup’s revenues, and for the first time, internet business from overseas outweighed UK online sales.

Julian Dunkerton, Supergroup chief executive, remarked:

“In a year that the Group is focusing on significant infrastructure investment our trading momentum has continued with strong increases in revenue and underlying profit giving us confidence for the future. The product developments across the two most recent seasons, in particular in womenswear, have helped to deliver like-for-like growth.”

While these were encouraging results, Supergroup took an £8m charge for exceptional items relating to its expansion costs and foreign currency hedging contracts, knocking their reported operating profit by 30% to less than £10m.

With a market cap of £950m, Supergroup shares trade at 20 times expected earnings, and offer a prospective dividend yield of only 0.7%.

Supergroup's turnaround since 2011 has been impressive, with many investors prematurely writing off the company's prospects last year. But is Supergroup the kind of investment you can count on for retirement?

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> Mark does not own any share mentioned in this article.