Ted Baker revenues increase 16.4 percent in FY16
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Business
Ted Baker Group revenue for the year increased by 16.4 percent or 10.8 percent in constant currency to 531 million pounds (663 million dollars). Profit before tax and exceptional items increased by 12.1 percent to 65.8 million pounds (82 million dollars) and profit before tax increased by 4.4 percent to 61.3 million pounds (76.5 million dollars). Adjusted basic earnings per share, which excludes exceptional items, increased by 13.3 percent to 114 and basic earnings per share increased by 5.1 percent to 105.7p.
"I am pleased to report another good year of progress in Ted Baker's expansion as a global lifestyle brand. We have continued to trade well and develop despite a backdrop of ongoing external challenges across our global markets. This success reflects the strength and appeal of the brand as well as the outstanding quality of our collections.,” said Ray Kelvin CBE, Founder and Chief Executive of Ted Baker in a statement.
Highlights of the FY16 results
The group gross margin increased to 61 percent from 59.9 percent last year due to improved full price sell-through in the company’s retail channel and an improved mix of wholesale sales to trustee customers, as well as some foreign exchange benefits.
The company’s retail division performed well, with sales up 15 percent or 9.2 percent in constant currency to 400.7 million pounds (500 million dollars). The growth, Ted Baker said, was driven by continued investments in new and existing stores and a strong e-commerce performance, where sales grew by 35.1 percent or 32.3 percent in constant currency to 72.3 million pounds (90.3 million dollars) and represented 18 percent of total retail sales.
The company’s wholesale business in the UK serves countries across the world, primarily in the UK and Europe, as well as supplying products to stores operated by our territorial licence partners. In addition, it operates a wholesale business in North America serving the US and Canada. Group wholesale sales increased by 20.9 percent or 15.9 percent in constant currency to 130.3 million pounds (162 million dollars), reflecting a good performance from the UK wholesale business, with sales increasing by 10.4 percent and a strong performance from North American wholesale business, with sales increasing by 48.8 percent or 30.7 percent in constant currency.
Ted Baker Womenswear delivered a good performance with sales up 19.7 percent to 304.3 million pounds (380 million dollars). Ted Baker Menswear sales were up 12.2 percent to 226.7 million pounds (283 million dollars).
Retail sales in UK and Europe up 10.7 percent
Retail sales in UK and Europe increased by 10.7 percent or 8.4 percent constant currency to 279.5 million pounds (349 million dollars), while ecommerce sales increased by 30.6 percent to 61.1 million pounds (76 million dollars). During the period, Ted Baker opened an outlet in Madrid, Spain and further concessions with premium department stores in the UK, France, Germany and Spain. It closed two stores, one in the UK and one in France. Sales from our UK wholesale division increased by 10.4 percent.
Sales from the company’s retail division in North America increased by 28.3 percent or 13 percent constant currency to 103.4 million pounds. During the period, the company continued our expansion with new stores in Atlanta, Miami, New York,Seattle and relocated the Dallas store, and we opened new stores in Calgary, Ottawa and an outlet in Vancouver. It also opened seven concessions in Mexico with the licence partner. Ted Baker closed one store in New York. Ecommerce sales increased 48.5 percent, while wholesale business sales increased by 48.8 percent or 30.7 percent constant currency.
Retail sales in Asia increased 15.6 percent to 17.8 million pounds (22 million dollars) or 2.6 percent in constant currency). In Hong Kong, Ted Baker relocated one store; in China, it opened a store in Beijing and four further concessions; and in Japan, the company opened three concessions and closed one store in Tokyo, which has been relocated since the period end. During the period, it launched online concession businesses in China and Japan. During the period, our Middle Eastern licence partners performed particularly well and opened stores in each of Azerbaijan, Dubai and Egypt and first store in Bahrain. Its South East Asian licence partner opened a store in Indonesia, and a new licence partner store opened in Vietnam. The company opened two stores in Taiwan and closed one. As at 28 January 2017, our licence partners operated 54 stores and concessions across the Middle East, South East Asia, and Africa. The company said, joint venture with Australasian licence partner, Flair Industries, continued to perform well. As at January 28, 2017, the company operated 9 stores in Australasia.
Current trading and retail outlook
In the UK and Europe, Ted Baker plans to open a new store in each of Oxford and Paris, an outlet in Gloucester and our first Dutch outlet in Roermond, along with further concessions in the UK, France, Germany and the Netherlands. It will continue to invest in our ecommerce sites to enhance customer experience. In North America, the company will continue to develop our presence with plans to open stores in Los Angeles and Houston, and relocate its Miami Aventura store. It also plans to open new concessions in Canada with a premium department store.
In Asia, in line with the company’s development strategy in this territory, Ted Baker has relocated a store in Tokyo and plans to open a further store in Shanghai and new concessions in Japan and South Korea.
The company anticipates further growth across its wholesale businesses, which is expected to result in high single-digit sales growth in constant currency in the coming period. The company’s product and territorial licences continue to perform well, with further store openings planned in Australia, Dubai, Kuwait, Lebanon, Mexico, Qatar, Saudi Arabia and Turkey along with first store in India.
The Board is recommending a final dividend of 38.8p per share, making a total for the period of 53.6p per share, an increase of 12.1 percent on the prior period.
In short
Picture:Ted Baker website