Superdry has warned that it no longer expects to make a profit this year and may have to raise new funds as a damp spring and the cost of living crisis hit sales. The British fashion brand said it was considering raising money as it also struggled with disappointing wholesale sales. The funds would be raised by offering new shares worth up to 20% of its market value – just under £14.5m at Friday’s share price – supported by its co-founder and chief executive, Julian Dunkerton, who owns a fifth of the company. Dunkerton took back control of the firm in a boardroom coup in 2019. Superdry said retail sales in February and March were showing “significant” growth on last year but had not met its expectations, partly because the cost of living crisis had hit spending and footfall, and poor weather had resulted in “less demand for our new spring-summer collection”. The update shook investor confidence in the retailer, as shares slumped 16% on Friday. The company said it had identified cost savings of £35m and was looking at options to reduce costs further, which it said would lead to a “material uplift in underlying profitability” in future. Dunkerton said the company needed to ensure it “is in the right shape to navigate these difficult times, which is why we are looking hard at our cost base”. He added: “My belief in the Superdry brand is stronger than ever, which is why I’m prepared to provide material support to any equity raise undertaken. I am confident that we have the right plan and, working together as a team, the business will emerge from the current turbulence stronger than ever.” Dunkerton, who started out selling clothes on a Cheltenham market stall, launched Superdry with the designer James Holder in 2003. Their first store opened in 2004 and the company grew rapidly before listing on the stock exchange six years later. Fashion retailers have been suffering as consumers rein in spending on non-essentials as they struggle with big increases in energy bills and food prices. Surveys suggest households that do have spare cash are focusing on holidays and trips out rather than refreshing their wardrobes, while sales of secondhand fashion, sold through sites such as Vinted and Depop, are booming as young people search for cut-price and more sustainable ways to dress. On Friday the bootmaker Dr Martens also warned that profits would be lower than hoped because problems at a distribution centre in the US had proved more expensive than expected to resolve. However, it said sales in the UK had risen by more than 10% after it increased prices last summer and shoppers continued to seek out its hardy footwear. The latest warning at Superdry comes less than four months after the company secured an £80m new loan facility, including £30m from the specialist lender Bantry Bay Capital, a firm backed by the hedge fund Elliott, amid what it called “extremely challenging” trading conditions in the UK leading up to Christmas. Uncertainty around negotiations on that loan prompted it to warn in October that “a material uncertainty exists” as to whether it would remain a going concern. Sophie Lund-Yates, the lead equity analyst at Hargreaves Lansdown, said that although “middle-value fashion is the most vulnerable during difficult times … there have also been execution-led failures with Superdry”.