High-quality clothes often last longer and wear better than their cheaper counterparts. The same is sometimes true in the world of equities, and certainly in the case of Ted Baker (TED). While many of its peers have been on a rollercoaster ride over the past year, Ted Baker reported a 24 per cent increase in underlying pre-tax profit to £49.5m - ahead of analyst forecasts.
The brand performed well across all of its divisions: retail sales in the UK and Europe grew 17 per cent to £232m, with revenue per square foot up 4 per cent to £869. Sales in North America rose by a quarter to £63.3m, and online sales in the US more than doubled following the successful migration of the website on to a new platform in July. Ted Baker's stateside expansion continued apace, with store openings in Las Vegas, Miami, Philadelphia and Toronto, as well as six new concessions.
On the wholesale side of the business, revenue was up by nearly a third to £81m, while licence income grew strongly, with good trading across footwear, eyewear and lingerie. Group online sales climbed 58 per cent to £36.7m.
Today the brand is a far cry from the shirt specialist eking out a profit in Glasgow back in the 1980s. Finance director Lindsay Page said part of Ted Baker's success comes from not having a huge number of stores - there are just 20 in the UK - which has allowed it to embrace e-commerce without cannibalising retail sales and downsizing its store estate, like so many of its peers have had to do. There's also considerable scope to grow overseas, where the label is still relatively unknown. Meanwhile, this year's spring/summer ranges are said to be popular with customers and there are further store openings in the pipeline, including one in London's fashionable Spitalfields quarter.
Analysts at Liberum have upgraded full-year adjusted pre-tax profit forecasts by 3 per cent to £55.1m, which would give EPS of 91p.
| TED BAKER (TED) | ||||
|---|---|---|---|---|
| ORD PRICE: | 2,726p | MARKET VALUE: | £1.2bn | |
| TOUCH: | 2,715-2,737p | 12-MONTH HIGH: | 2,905p | LOW:1,636p |
| DIVIDEND YIELD: | 1.5% | PE RATIO: | 33 | |
| NET ASSET VALUE: | 320p | NET DEBT: | 13% | |
| Year to 31 Jan | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 188 | 24.2 | 41.5 | 20.6 |
| 2012 | 216 | 24.3 | 42.2 | 23.4 |
| 2013 | 254 | 28.9 | 51.5 | 26.6 |
| 2014 | 322 | 38.9 | 67.2 | 33.7 |
| 2015 | 388 | 48.8 | 82.0 | 40.3 |
| % change | +20 | +25 | +22 | +20 |
Ex-div: 21 May Payment: 19 Jun | ||||
