Ted Baker braced for hard times in US as strong dollar hits sales
FASHION brand Ted Baker today warned of tough times ahead for its US business as tourists stay away from the country.
The company defied High Street blues as it reported rising sales and profits in the last year, but said external factors had hit all its markets.
In North America, those factors included a fall in international tourism, which boss Ray Kelvin largely put down to the rising dollar. The US currency had been rising on growth expectations under President Trump.
Sales rose 16.4% to £531 million in year ended January 28, and pre-tax profits before one-off costs were up 4.4% at £61.3 million.
Sales grew in all regions and channels, with e-commerce the star performer thanks to a 35.1% revenue rise. Kelvin described the results as “pleasing” given how “challenging” the market is for a number of reasons, including the effect of terrorism in Europe.
He added that the company had no plans to increase prices, despite the weaker pound sending costs higher. The company has hedged its exposure to the US dollar until 2018.
Broker Liberum maintained its Buy rating on the stock and said: “Ted has a resilience born of a strong brand, strong and stable underlying operating margins and global growth opportunities.”
@clarehutch