Superdry Plc is seeking to tap investment funds to repay banks on a loan due in January as the cost of living crisis hits consumer spending.
The London-listed clothing company has been sounding out potential new investors to replace an asset-backed facility worth £70 million ($83 million), according to people familiar with the matter, who asked not to be named because the talks are private.
The company said it’s in “positive ongoing discussions with lenders” when contacted by Bloomberg News, reiterating what it said in a quarterly report published last month. Spokespeople didn’t elaborate further on the talks. In the report, Superdry’s directors acknowledged that there was material uncertainty over the company’s ability to continue as a going concern until funding was secured.
The company is working with PricewaterhouseCoopers as financial adviser, the people said. A representative for PwC declined to comment.
Shares of Superdry reversed earlier gains and were 1.7 percent lower at 4:01 p.m. in London.
The cost of living crisis combined with supply chain challenges have proved too much for some retailers. Online furniture store Made.com Group Plc and clothing chain Joules Group Plc have both filed for insolvency this month.
Superdry, which is known for its logo T-shirts and bright colours, reported a return to profit last month driven by selling more clothing at full price. The business said that its financial year has got off to an “encouraging” start and analysts at Liberum said they’re confident in Superdry’s “long-term trajectory.” Still, store visits to Superdry haven’t yet recovered to pre-Covid levels.
By Giulia Morpurgo
The retailer, known for its logo T-shirts and bright colours, reported adjusted profit before tax of £21.9 million ($24 million), compared with a £12.6 million loss a year earlier. The shares rose as much as 13 percent in London.