Ted Baker (TED) shares took a tumble as news of softer retail sales, exposure to the recent House of Fraser collapse and warnings of tough conditions on the British high street put the market on edge. Analysts at Liberum believe the business remains “resilient and agile” and “well-placed in tough markets”, but did admit the gross margin improvement seen last year was likely to reverse in the second half, despite easier comparative figures. For now, analysts at the broker still expect pre-tax profits of £76.9m for the year ending January 2019, giving EPS of 135p, compared to £73.5m and 129p a share in FY2018.
Chief executive Ray Kelvin said the second half would "remain challenging", but says management is focused on developing Ted’s ‘multi-channel’ style of retailing. That means spreading sales across stores, online, wholesale and licencing, while still taking a "measured and controlled" approach to costs. In the first half, e-commerce sales rose by nearly a quarter to £53m, helping to pep up total retail sales by 1.1 per cent to £220m at actual exchange rates, and wholesale revenues climbed by 10 per cent to £86m.
| TED BAKER (TED) | ||||
| ORD PRICE: | 2,074p | MARKET VALUE: | £ 925m | |
| TOUCH: | 2,070-2,076p | 12-MONTH HIGH: | 3,244p | LOW: 1,979p |
| DIVIDEND YIELD: | 3.0% | PE RATIO: | 18 | |
| NET ASSET VALUE: | 527p | NET DEBT: | 57% | |
| Half-year to 11 Aug | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2017 | 296 | 25.3 | 43.6 | 16.6 |
| 2018 | 306 | 24.5 | 42.8 | 17.9 |
| % change | +3 | -3 | -2 | +8 |
| Ex-div: | 11 Oct | |||
| Payment: | 23 Nov |
