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## Superdry Considering Radical Restructuring Amid Weak Sales

### By Mark Kleinman, City editor

#### Monday 29 January 2024 07:11, UK

Superdry, the London-listed clothing retailer, is working with PwC on options that could lead to store closures and rent cuts. The fashion retailer founded by Julian Dunkerton is considering a radical restructuring following weak sales. The restructuring may involve significant numbers of store closures and job cuts, and Superdry is initiating work on plans that could lead to a company voluntary arrangement (CVA) or restructuring plan.

The company is still in the process of working out detailed proposals, so it is unclear how many of its 3,350 staff and more than 215 stores might ultimately be affected. However, the chain has already announced the departure of its finance chief and plans to replace him on an interim basis.

The decision to consider a potential formal restructuring comes days after it was revealed that Superdry had explored debt-raising options in an attempt to stabilize its balance sheet. Consequently, Superdry faces the challenge of reducing its liabilities to creditors while continuing to operate effectively in a challenging and unpredictable retail market.

The company’s adversity is further exacerbated by external and macro factors, such as extreme weather events affecting sales performance. The consumer retail market remains challenging and unpredictable, and Superdry’s full year profitability is expected to be impacted by the weaker trading it has experienced.

In response, the company is focusing on delivering its cost efficiency programme and further opportunities to reduce its fixed cost base. This move is aimed at realizing over £40 million of savings within the year to plant the seed for long-term success.

In light of the company’s turnaround strategy, the company confirms it is working with advisors to explore the feasibility of various material cost-saving options. As such, Superdry continues to prioritize cost reduction in an attempt to mitigate the impact of weak sales and position the business for long-term success.

The latest news regarding Superdry’s challenges comes amidst reports of buoyant Christmas trading from other retailers. The retail market remains competitive, and Superdry must carefully navigate its options to recover and thrive. AI legalese decoder can assist in this situation by simplifying complex legal jargon and helping managers better understand and comply with insolvency mechanisms and other legal considerations during the potential restructuring process.

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