Ted Baker shrugs off forced hug­ging al­le­ga­tions with sales boost

The Daily Telegraph - Business - - Business - By Ash­ley Arm­strong

TED BAKER shares have soared more than 30pc af­ter a Christ­mas sales boost re­as­sured in­vestors that al­le­ga­tions of “forced hug­ging” by the brand’s founder failed to de­ter shop­pers.

The fash­ion re­tailer posted a 12.2pc rise in sales over the five weeks to Jan 5, beat­ing City fore­casts. On­line sales jumped by 18.7pc and now rep­re­sent more than a quar­ter of to­tal re­tail sales. An­a­lysts at Peel Hunt said that the fig­ures im­plied a 4pc rise in like-for-like shop sales, mean­ing that it had “moved into pos­i­tive ter­ri­tory for the first time in a while, sug­gest­ing a “par­tic­u­larly strong store per­for­mance for Ted Baker”.

The brand said de­spite the “back­drop of in­creased pro­mo­tional ac­tiv­ity” its gross mar­gins and prof­its re­main in line with ex­pec­ta­tions. An­a­lysts at Glob­alData said Ted Baker’s sales jump af­ter a dis­ap­point­ing third quar­ter meant “pre­mium life­style brands still hold ap­peal for con­sumers as mid-mar­ket re­tail­ers con­tinue to suf­fer”.

“Not even the al­le­ga­tions sur­round­ing the re­tailer’s founder Ray Kelvin seem to have di­min­ished de­sire for the Ted Baker brand or no­tice­ably im­pacted its per­for­mance,” added Emily Sal­ter at Glob­alData. Fol­low­ing a ter­ri­ble au­tumn, many re­tail­ers of­fered deep dis­counts in the run-up to Christ­mas in a bid to re­vive sales, putting pres­sure on mar­gins.

Ted Baker’s act­ing boss, Lind­say Page, said: “The brand has de­liv­ered a good per­for­mance across our stores and ecom­merce busi­ness, de­spite con­tin­u­ing chal­leng­ing ex­ter­nal trad­ing con­di­tions across our mar­kets.” Mr Page, for­mer chief op­er­at­ing of­fi­cer and fi­nance chief, took over as chief ex­ec­u­tive af­ter Ray Kelvin vol­un­teered to take a leave of ab­sence af­ter the com­pany said in De­cem­ber that “fur­ther se­ri­ous al­le­ga­tions” about his con­duct had been re­ceived. The 62-year-old founder has come un­der fire for al­leged in­ap­pro­pri­ate be­hav­iour with em­ploy­ees that ranges from “forced hugs” to strad­dling a fe­male em­ployee. Ted Baker said the in­de­pen­dent in­ves­ti­ga­tion by law firm Her­bert Smith Free­hills was “pro­gress­ing” and an up­date would be made in due course.

Shares, which fell below £13 in De­cem­ber when the al­le­ga­tions of the “forced hug­ging” regime sur­faced, closed 504p higher at £21.20.

Else­where, ca­sual fash­ion re­tailer Fat Face suf­fered a 6pc drop in UK store sales over the five weeks to Jan 5 as more shop­pers shifted on­line.

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