Profits Up 25% At Supergroup PLC

Strong store growth and success with womenswear help push sales up 15% at Supergroup PLC (LON:SPG).

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

SuperGroup (LSE: SGP) reported strong 15% growth in sales for its fiscal 2013, while underlying profits (ignoring non-cash and non-operating gains and losses) were up 25%.

Same store sales (sales at stores open for at least a year so meaningful comparisons can be made) were up 5.7% and the group opened 10 owned stores and 53 franchised stores during the year — with the franchises mainly in Asia and the Middle East.

Sales were helped by the success of the growing women’s lineup and the translation of the online store into 10 new local language sites. Online sales grew 28% and now make up over 11% of total sales.

The company’s rapid growth in recent years led to some growing pains in fiscal 2012 when inventory issues resulted in lost sales and some management blunders resulted in a shake-up at the top — and a dramatic drop in the share price.

SuperGroup has continued to invest in its management team — bringing in General Counsel and a Financial Controller, Directors of IT and HR, a Managing Director for the International and Wholesale operations, as well as Heads of Logistics, UK/Ireland Retail and Women’s Design.

SuperGroup also signed an agreement with a logistics partner to help handle the company’s warehouse and distribution operations which will become even more important as the online store is rolled out to more than 16 countries and all the orders will be fulfilled from here in the UK.

Trading on a P/E of 19, the shares may appear a bit pricey, but last year’s growth — as well as management’s investment in future growth — would seem to justify a premium. With the shares well down from their ridiculous highs of early 2011 and plenty of positive signs and seemingly lots of room to grow, the shares might be worth a look for those growth-inclined investors out there.

And if you are a growth-inclined investor you’ll want to check out The Motley Fool’s favourite growth share for 2013.

You can get the free report just by clicking here.

> Nate does not own any shares discussed above.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

More on Company Comment

Hand of person putting wood cube block with word VALUE on wooden table
Company Comment

Value has been building behind the Diageo share price

Despite the business growing, the Diageo share price first reached its current level just over 19 months ago and hasn't…

Read more »

Older couple walking in park
Investing Articles

5 stocks to buy for high and rising dividend income

I can see a host of shares to buy on the FTSE 100 offering me exceptional levels of income. Here…

Read more »

Young mixed-race woman looking out of the window with a look of consternation on her face
Investing Articles

I don’t care if FTSE 100 shares fall further, I’m buying them today

I'm happy to go shopping for FTSE 100 shares today, even though I accept that they could have further to…

Read more »

Happy young female stock-picker in a cafe
Investing Articles

Rolls-Royce shares are down 18% in a month and I’m finally going to buy them

Investors who bought Rolls-Royce shares have been repeatedly disappointed, but I'm willing to take a chance on them before they…

Read more »

Storytelling image of a multiethnic senior couple in love - Elderly married couple dating outdoors, love emotions and feelings
Investing Articles

How I’d invest £10k in a Stocks and Shares ISA today

Now looks like a good time to buy cheap FTSE 100 shares inside a Stocks and Shares ISA. These are…

Read more »

Black father holding daughter in a field of cows
Investing Articles

Today’s financial crisis is the perfect moment to buy cheap shares

I'm building a portfolio of FTSE 100 stocks by purchasing cheap shares whenever I see an opportunity. There's a good…

Read more »

Long-term vs short-term investing concept on a staircase
Investing Articles

I’d buy Tesco shares in October to bag their 5.4% yield 

Tesco shares have fallen lately but I think this makes them attractively valued for a dividend stock I would aim…

Read more »

Young mixed-race woman looking out of the window with a look of consternation on her face
Investing Articles

I would do anything to hold Diageo in my portfolio (but I won’t do that)

Diageo is one of my favourite stocks on the entire FTSE 100 and I'd love to hold it, but one…

Read more »