Ted Baker, the formal and occasion wear retailer, has reported a slump in annual sales during the coronavirus pandemic but argued it is now better placed to navigate continuing disruption.
The fashion chain reported a deepening pre-tax loss of £107.7m for the year to the end of January on the back of a £77.6m sum in the previous 12 months.
The company was already in the doldrums at that time – before COVID-19 hit – as it pledged a recovery from a string of setbacks including a £58m inventory overstatement and the departure of previous chief executive and founder Ray Kelvin following misconduct allegations – claims he has denied.
Ted Baker said on Monday that the pandemic had taken an inevitable toll on its CEO Rachel Osborne’s transformation plan, which includes a greater focus on online sales.
It revealed an underlying pre-tax loss of £59.2m for its last financial year compared to a £4.8m profit the previous year as its global store footprint fell under coronavirus trading restrictions.
Total revenue fell 44% to £352m though e-commerce sales were up 22% to £144.9m.
The company, like many rivals, had to cut jobs and raise cash during the height of the crisis as it navigated the disruption to normal life which heavily restricted demand for its prime offering.
Competitors with a focus on athleisure and casualwear have tended to do better given more people working from home and the lack of opportunities to enjoy nights out.
Ms Osborne said: “While the impact of COVID-19 is clear in our results and has amplified some of the legacy issues impacting the business, Ted Baker has responded proactively and is in a much stronger place than it was a year ago.
“During the period, we delivered robust cashflow generation, fixed our balance sheet, refreshed our senior leadership team and today we are upgrading our financial targets for the second time since outlining our new strategy last summer.
“Additionally, we have made good progress with our sustainability strategy, Fashioning a Better Future, including the mapping of all of our factory partners within our supply chain and significantly increasing our usage of cotton from sustainable sources to 69%.”
Shares opened positively initially but later fell back by around 1.6%.
Senior analyst at Freetrade, Dan Lane, said the results represented something of an own goal, despite the increase in e-commerce sales.
“Ted’s online presence needs an almighty boost and should have been focused on years ago.
“It finally started to get some attention as part of ‘Ted’s Formula For Growth’ but leaving it so late has meant being ill-prepared for the shift online over the year.
“It’ll be the epitome of ‘too little too late’ for a lot of beleaguered investors.”