TIDMTED
RNS Number : 9047K
Ted Baker PLC
07 September 2021
7 September 2021
Ted Baker Plc ("Ted Baker", the "Group")
Q2 2022 / Pre-close trading update
For the 16-week period from 25 April 2021 to 14 August 2021
("the Period")
Sales in line with expectations, significant improvement in full
price mix
Ted Baker Plc, the global lifestyle brand, today provides an
update on trading for the 16-week period from 25 April 2021 to 14
August 2021.
Q2 Highlights
-- Sales in line with expectations, with continued Covid-impact
leading to different speeds of recovery across key markets.
-- Group sales growth of 50% compared to Q2 FY2021
-- Trading momentum continued to build through the period, with
the last four week exit rate for Retail better than the overall Q2
performance for Retail sales.
-- North American concessions, North American and UK shopping
malls showing improved performance as consumer confidence
recovered.
-- Trading margin improved over +500 bps due to significantly
better full price mix across all retail channels. Re-establishing
our premium positioning has meant moving away from the aggressive
promotional stance in Q2 last year, negatively impacting the sales
performance of eCommerce relative to last year.
-- Ongoing strong stock control led to clean inventory position at end of the period.
-- Transformation plan on track; solid progress against operational KPIs set for fiscal 2022.
-- Brand remains strong; recent YouGov survey recognised Ted
Baker as second most popular luxury brand in the UK.
-- Autumn/Winter 2022 collections positively received by Ted
customers, with encouraging early sales. Newness working well, with
positive response to new product pyramid structure.
-- Signed new global HQ, Gorgeous Brown Building. New lease deal
secured rental savings of GBP3.3m p.a. compared to the option to
lease for Block A of the Tribeca development in Kings Cross.
-- The Group has made good progress on the work for the new
eCommerce platform, but some technical aspects have taken longer
than expected to fully resolve. Given the proximity to the upcoming
peak trading period and need to fully test its business readiness
and stability ahead of implementation, we will move the go live
date to early 2022. This date change will have no material impact
on the performance of our eCommerce business .
-- Further strengthened the Board with the appointment of two
independent Non-Executive Directors, Fumbi Chima and Meg
Lustman.
-- Continued progress with our Fashioning a Better Future Programme.
Rachel Osborne, Chief Executive Officer, commented:
"We have made encouraging progress, with trading over the second
quarter in line with expectations, albeit the speed of recovery is
different across store locations and regions. Full price sales mix
has significantly improved across all our retail channels as we
continue to re-establish our premium lifestyle brand
positioning.
"Our transformation programme remains on track, and we have
moved forward on the three key pillars of our plan in refreshing
and re-energising the product and brand, prioritising digital and
capital light growth and through our cost savings programme.
"The Ted Baker brand remains strong, evidenced by YouGov's
recognition of Ted Baker as the second most popular luxury brand in
the UK. Our product also continues to strengthen, and we are
pleased by the start to the Autumn/Winter 2021 collections which is
being well received by our customers. Combined with our robust
balance sheet and strong cash management we are well placed for the
future. It is still early days in the recovery, but we are
confident that Ted is starting to emerge from Covid a stronger and
more resilient business."
Q2 financial and operational highlights:
-- Group revenue grew year-on-year by 50% for the period as we
snapped back from the material negative impact from the COVID
pandemic.
-- Reported Retail sales increased 30% vs Q2 FY2021 but were 30%
below Q2 FY2020. Stronger exit rate from Q2 FY2022, as Retail sales
improved sequentially throughout the period.
-- Sales growth affected four percentage points due to change
accounting for our Japanese and Chinese businesses as this moved
from Retail to licence and JV.
-- Store sales were +142% vs Q2 FY2021 and -45% vs Q2 FY2020.
While many of our stores were open during the trading period,
footfall remains below prior levels and continues to be stronger in
out-of-town and regional locations where we have a smaller physical
presence.
-- Our non-metro centre stores continue to show a healthy
recovery. We anticipate a similar trading pattern in the second
half, as metro centres and travel retail recover more slowly than
our overall store estate given ongoing slow recovery of
international tourism and the still limited return to offices
across the UK and other markets.
-- The Group opened two new short-term lease stores in the UK,
in Bromley and Exeter, to expand into these non-metro centre
locations, with another one planned during the balance of the
year.
-- Group eCommerce sales decreased 25% and represented 39% of
total retail sales (2021: 67%), reflecting highly promotional
stance last year ahead of balance sheet recapitalisation. Compared
to Q2 FY2020, Group eCommerce sales increased 17%.
-- Wholesale and licence revenue increased by 151% and decreased
29% compared to Q2 FY2020. Several of our newer licence partners
have seen positive momentum during Q2, including Next and
Baird.
-- Our eyewear licence partners, among the biggest in the Group,
continue to show robust performance, up 72% compared to Q2 FY2021
and up 27% compared to Q2 FY2020.
-- Retail trading margin improved by over 500 basis points vs Q2
FY2021 and +190bp vs Q2 FY2020 as the Group prioritised full price
trading stance.
-- As of 14 August 2021, net liquidity was GBP105.8m comprising
GBP15.8m of cash and GBP90m of bank facilities. The Group has
material liquidity headroom against anticipated peak cash
requirements in September/October 2021.
Appointment of Non-Executive Directors - additional
disclosure
Further to our announcement on 4 August 2021, relating to the
appointments of Fumbi Chima and Meg Lustman as Non-Executive
Directors of the Company, there are no further disclosure
requirements under Listing Rule 9.6.13 in respect of these
appointments.
Ted Baker will announce its results for the 28-week period ended
14 August 2021 on 11 November 2021.
The Group will host a conference call for analysts and investors
to discuss this announcement at 8.45am today. Dial-in details are
as follows:
UK +44 330 336 9127
Passcode: 8111188
Enquiries:
Ted Baker Plc Tel: +44 (0) 20 7255
4800
Rachel Osborne, Chief Executive Officer
David Wolffe, Chief Financial Officer
Tulchan Communications Tel: +44 (0) 20 7353
4200
Jonathan Sibun/Jessica Reid tedbaker@tulchangroup.com
Media images available for download at:
http://www.tedbakerplc.com/ted/en/mediacentre/imagelibrary
Cautionary statement regarding forward-looking statements
This announcement contains certain forward-looking statements.
These forward-looking statements include matters that are not
historical facts or are statements regarding the Group's
intentions, beliefs or current expectations concerning, among other
things, the Group's results of operations, financial condition,
liquidity, prospects, growth, strategies, and the industries in
which the Group operates. Forward-looking statements are based on
the information available to the Directors at the time of
preparation of this announcement and will not be updated during the
year. The Directors can give no assurance that these expectations
will prove to have been correct. Due to inherent uncertainties,
including both economic and business risk factors underlying such
forward-looking information, actual results may differ materially
from those expressed or implied by these forward-looking
statements.
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END
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