Shares at men’s fashion retailer Ted Baker plunged by as much as 35% in early trading today (3 October) after it reported a 193.9% fall in half-year profits, marking a loss of £23m.
The decrease in profits for the 28 week period ending 10 August 2019 was largely due to an exceptional costs of £17.4m. It said this was incurred as a result of actions taken to strengthen the brand, and included £11.8m in respect of the restructure of the legacy Asia businesses and £3.5m in relation to the footwear acquisition in January 2019.
Additionally, group revenue decreased by 7% to £303.8m and retail sales including e-commerce was down 2.5% to £214.5m.
The retailer said it was a challenging half, and that trading conditions have been characterised by “unprecedented and sustained” levels of promotional activity across the sector with, in several cases, “distressed” discounting from brands and retailers and heightened competition.
CEO Lindsay Page said: “We are continuing to pro-actively manage the significant challenges impacting our sector including weak consumer spending, macro-economic uncertainty, and the accelerating channel shift towards e-commerce.
“However, we are not immune to these pressures which have impacted our financial performance during the first half of the year.”
She added: “We remain actively focussed on cost control and driving further efficiencies. Despite the structural challenges and cyclical pressures on the industry, we remain confident in Ted Baker’s ability to navigate the market and further develop as a global lifestyle brand.
“This confidence remains underpinned by the group’s flexible, omni-channel model, the continuing strength of the brand, and the skill, passion and commitment of our talented teams worldwide.”