Shares in Ted Baker slump despite profit hike and strong global sales

Shares in British clothing giant Ted Baker (LON:TED) slumped on Thursday, despite a 4.4 percent rise in pre-tax profit and surging sales in all markets. 

The company, who have concessions and stores across the world, saw group pre-tax profit rise to £61.3 million in the year to the 28th January 2017. Total retail sales rose 15 percent to £400.7 million, with its business in the US and Canada performing particuarly well, up 28.3 percent.

Ray Kelvin CBE, Founder and Chief Executive of Ted Barker, said the results showed “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 on-going 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.

“Our Spring/Summer collections have been well received and we have a clear strategy for continued growth across both established and newer markets. This is underpinned by controlled distribution across channels as well as the design, quality and attention to detail that are at the core of everything we do.

“The Group’s business model as well as the strength of the brand, our team and collections support confidence in Ted Baker’s further development and growth”, Kelvin concluded.

The group proposed a final dividend of 38.8p, bringing the total dividend to 53.6p, compared to 47.8p a year earlier.

However, shares in the company sunk in early trading on Thursday, currently trading down 3.80 percent at 2,732.00 (0846GMT). In the statement Ted Baker had acknowledged the challenges facing clothing retailers amid rising inflation and Brexit concerns, adding that  trading across its markets continues to be hit by ongoing external factors.