Ted Baker – All Dressed Up, But Where Will They Go
Relaxed covid restrictions helped Ted Baker plc (LON:TED)’s half year revenue rise 21.4%, excluding currency changes, to £199.3m. Revenue was 36.4% below pre-pandemic levels. The proportion of items sold at full price rose by more than 5 percentage points, which helped pre-tax losses narrow to £25.3m from £86.4m.
Get Our Icahn eBook!
Get our entire 10-part series on Carl Icahn and other famous investors in PDF for free! Save it to your desktop, read it on your tablet or print it! Sign up below. NO SPAM EVER
Q3 2021 hedge fund letters, conferences and more
Invest For Kids: Long Thesis For Shell
Several hedge fund managers presented their stock picks at the 13th annual Invest for Kids conference last week. Among the presenters was Nadine Terman of Solstein Capital, who presented her thesis for Shell. Q3 2021 hedge fund letters, conferences and more The firm seeks non-consensus positions with limited downside and targets eight to 15 high-conviction Read More
In the 12 weeks to 6 November, revenue rose 20%. The recovery in retail sales has been uneven with stores exposed to travel retail continuing to struggle. Full price sales continued to grow as a proportion of sales, though less promotional activity meant eCommerce sales fell 10%.
Management now expects have a net cash position by year-end and is “comfortable” with market expectations for full-year revenue of £468m and a £23.8m pre-tax loss. The new eCommerce platform is on track to launch in early 2022
The shares rose 3.2% following the announcement.
Ted Baker’s Q2 Earnings
Laura Hoy, Equity Analyst at Hargreaves Lansdown:
“Ted Baker’s half year results showed the fashion retailer is clawing its way back towards profitability as it works to restore its image as a premium brand. With weddings back on the social calendar and offices reopening, people are willing to spend more on their clothes and as a result Ted saw losses narrow as margins improved.
The headline figures dress up a concerning decline in eCommerce sales though. Heavy promotional activity last year meant online sales were booming, so the group was up against tough comparisons. And we commend the group’s commitment to backing away from discounting, which eroded the brand image. Still, a double-digit decline in online sales is troubling.
A big part of Ted’s transformation plans rests on improving the group’s digital presence and progress on this front has been sluggish with management pushing back the launch of its new online platform to early 2022. While easing pandemic restrictions means people can return to in-person shopping, it doesn’t mean they will. Losing ground in e-commerce is bad no matter how you slice it. The online shopping boom hasn’t showed any signs of slowing, and the we would’ve like to see the same from Ted’s eCommerce sales.”
About Hargreaves Lansdown
Over 1.67 million clients trust us with £138.0 billion (as at 30 September 2021), making us the UK’s number one platform for private investors. More than 98% of client activity is done through our digital channels and over 600,000 access our mobile app each month.
Updated on Nov 11, 2021, 11:19 am