Superdry plunges as co-founder returns

Bloomberg

Superdry Plc shares plunged as its board and top management resigned following a shareholder vote to bring back co-founder Julian Dunkerton at the helm of the UK apparel retailer.
Chairman Peter Bamford, Chief Executive Officer Euan Sutherland and Chief Financial Officer Ed Barker will leave immediately, the company said. Dunkerton will take over as interim CEO and join the board after leaving the company about a year ago.
The showdown at the UK retailer with the faux-Japanese logo followed months of tension between the departing management and Dunkerton, who criticised a decision to expand the retailer’s range beyond the coats and jackets it’s known for.
He also launched a “Save Superdry” website, where he said the company was “devastated through a misguided strategy.”
Dunkerton holds an 18 percent stake, according to data compiled by Bloomberg. Since his departure, the shares have lost more than two-thirds of their value and the company has issued repeated profit warnings.
“The immediate impact of Julian’s return is likely to be additional costs as he rebalances the business and seeks to reinvigorate the product,” Peel Hunt analysts including John Stevenson said in a note. These costs “will be incurred before we see any top-line benefits.”
Product Lineup
The retailer, whose clothes are popular with millennials, has said the changes in its product offering were needed to boost sales after it blamed warmer weather over the fall and a lack of variety for its disappointing results.
Advisory firm Institutional Shareholder Services had recommended a vote against Dunkerton’s return, while some big investors favored the move.
Boardroom dramas are proliferating in UK retail as the sector struggles with a shift to online shopping and consumer jitters over Brexit. Billionaire Mike Ashley orchestrated the ouster of the chairman and CEO of Debenhams from the board in January, and he’s
proposed removing most of the board and installing himself as chief.
Until recently, Superdry bucked the gloom, growing rapidly as young consumers snapped up its T-shirts and hoodies. The co-founder said last year that he was leaving to pursue other projects, following reports of the conflict over strategy.