UK: Overseas expansion lifts Ted Baker sales
Fashion retailer Ted Baker Plc has managed to shrug off challenging trading conditions to post a double-digit jump in revenue in the first 19 weeks of its financial year - but said it remains cautious in its outlook.
Overseas expansion of its US wholesale business and the opening of new retail space in the US, Spain Japan, the Netherlands and South Korea helped lift group revenue by 14.6%, the firm said today (12 June).
Retail sales climbed 16.2% over the same period last year. Wholesale sales were 8.9% higher, mainly driven by the continued growth of its US wholesale business.
"We are pleased with performance across all territories despite a backdrop of challenging trading conditions," the company said. But it added: "We remain mindful of the uncertain economic environment in which we operate."
"The Group has made a good start to 2012, despite continued uncertainty in the trading environment," noted founder and chief executive Ray Kelvin.
International stores are also due to open in New York, Hong Kong, Toronto, Beijing and Shanghai in the coming months.
"Ted Baker has been able to post solid results because it has persuaded customers it is worthwhile paying a premium for product which has a quality edge as well as strong design credentials," notes analyst Neil Saunders, managing director of Conlumino.
"This 'flight to quality' has been a notable trend during the downturn and consumers have cut back on the overall volume of clothing purchased and invested some of the resultant savings into buying expensive, 'must have' pieces.
"Although helpful for a brand like Ted Baker this trend does not deliver benefits without effort. Staying on trend and keeping brands relevant and interesting is critical in premium clothing where consumers are more demanding and competition is now arguably more intense. In our view, this is where Ted Baker has really delivered."
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