Ted Baker profits plunge 26% in 2018

Fashion retailer Ted Baker has reported a 26.1% drop in pre-tax profit to £50.9m for the year ending 26 January 2019, compared with £68.8m the previous year.

In February, the retailer issued a profit warning and said profits had been “adversely affected” by three non-cash impacts, including: Foreign exchange movements in the final week of the financial year, resulting in a profit impact of approximately £2.5m relating to the translation of inter-company balances.

Despite this, group revenue increased by 4.4% (5% in constant currency) to £617.4m, compared with £591.7m in 2017, and UK and Europe retail sales grew by 4.6% (up 4.5% in constant currency) to £315m. E-commerce sales also rose by 20.4% to £121.7m.

Acting CEO Lindsay Page said: “Ted Baker has continued to grow across each of the brand’s distribution channels despite difficult trading conditions across a number of the group’s global markets. This resilient sales performance again reflects the strength of the brand, the talent of our teams, and the quality of our collections.

“I would like to take this opportunity to thank each of my colleagues for their outstanding enthusiasm, skill and commitment and our global partners for their support throughout the year.”

It comes after Ted Baker founder Ray Kelvin resigned from his position as CEO and director earlier this month, amid allegations of misconduct.

Kelvin took a voluntary leave of absence from his role in December 2018, after the allegations of misconduct were made against him, and since that date an internal independent committee has been in the process of investigating the claims.

The committee commissioned law firm Herbert Smith Freehills (HSF) to investigate the allegations and the company’s policies, procedures and handling of HR-related complaints. It is expected that HSF will conclude its investigation at the end of Q1 or early in Q2 2019.