RNS Number:1082L
Ted Baker PLC
4 October 2001
4 October 2001
Ted Baker PLC
Interim Results for the 28 weeks to 11 August 2001
Highlights
* Turnover up 39.7% to #27.8 million (2000: #19.9 million)
* Excellent growth in womenswear, up 51.3% and now representing 43.2%
of total sales
* Strong growth in menswear collections, which include the successful
Endurance collection
* Revenues from other collections more than doubled - particularly
reflecting development of the shoe business
* Operating profit up 27.3% to #2.8 million (2000: #2.2 million)
* Profit before tax up 19% to #2.5 million (2000: #2.1 million)
* Earnings per share up 13.5% at 4.2p (2000: 3.7p)
* Interim dividend up 12.5% to 2.7p per share (2000: 2.4p per share)
Commenting, Ray Kelvin, Chief Executive, said:
"A good performance in the first half of the year once again confirms our
belief in the strength of the Ted Baker brand and its capacity for expansion.
We have traded well since the end of the first half and, barring any
unforeseen external factors, we look forward to a successful outcome for the
year."
Enquiries:
Ted Baker 020 7255 4800
Ray Kelvin, Chief Executive
Lindsay Page, Finance Director
Hudson Sandler 020 7796 4133
Piers Hooper/Noemie de Andia
CHAIRMAN'S STATEMENT
OVERVIEW
During the period under review we have continued to introduce new collections,
extend our existing ranges, and expand our channels of distribution. The
performance of all our divisions is in line with expectations.
FINANCIAL HIGHLIGHTS
In the 28 weeks to 11 August 2001, turnover increased by 39.7% to #27.8
million (2000: #19.9 million) demonstrating the continued strength of the
brand. Operating profit was #2.8 million compared to #2.2 million for the
equivalent period last year, an increase of 27.3%.
As expected, the composite gross margin was 55.7% compared to 57.9% for the
equivalent period last year. Our retail margins particularly reflected the
scheduling of our summer sale earlier than in previous years and an increased
number of outlet stores, which necessarily generate lower margins. Wholesale
margins were affected by changes in the product mix, particularly as a result
of the continued success of our Endurance collection.
Profit before tax for the period improved by 19% to #2.5 million (2000: #2.1
million). Earnings per share were 4.2p compared to 3.7p for the equivalent
period last year. The Board has declared an increased interim dividend of 2.7p
per share (2000: 2.4p) payable on 29 November 2001 to shareholders on the
register at the close of business on 12 October 2001.
RETAIL
Retail sales were up 46.5% to #18.6 million (2000: #12.7 million). Retail
gross margins were 64.6% (2000: 67.2%) reflecting, as noted above, an earlier
summer sale during the period and increased turnover as a proportion of the
whole from our five outlet stores.
During the first half of the year, one new store opened in Gatwick and an
outlet store opened in Portsmouth bringing the total number of stores to 22.
Our existing store in Leeds was extended and refurbished between April and
June, during which time it was closed. All have yet to achieve maturity but
are already trading above expectations.
Average retail square footage increased by 40% from 41,000 sq ft to 57,384 sq
ft. Sales per square foot were #324 compared to #310, reflecting the opening
of larger stores, the addition of new, immature space and of outlet stores and
a contribution for the whole period from some stores opened during the first
half of 2000.
WHOLESALE
UK wholesale revenues rose by 43.6% to #8.9 million (2000: #6.2 million). Our
wholesale sales particularly reflect the continued success of the Endurance
collection for men and women, the expansion of Ted Baker Woman, and the
continued expansion of our shoe collection. The number of trustees, or
wholesale outlets, for the principal collections in the UK increased by 8.7%
to 572 (2000: 526). Wholesale gross margins were 37.9% (2000: 41.5%)
reflecting a change in product mix during the period as discussed above.
Overseas wholesale sales were #305,000 (2000: #961,000) reflecting the
absorption of the US wholesale by the licence business.
LICENCE INCOME
Licence income increased from #269,000 to #703,000, reflecting a further
successful year for Ted Baker fragrances and a contribution for the whole
period from the US licensing agreement signed in February 2000, in line with
the minimum guaranteed level. Our US licensee Hartmarx continues to make good
progress in the development of the Ted Baker brand in the United States,
focusing initially on our menswear collections. Trading relationships are
being developed with key retailers including Bloomingdales, where dedicated
space will be opening shortly in the Manhattan flagship, Jacobsons and Holt
Renfrew of Canada. The Ted Baker sunglasses collection, which was launched
under licence in spring 2001, has also performed well over the period.
COLLECTIONS
Our main collections have been expanded further and continue to be well
received. Womenswear enjoyed an excellent performance as sales increased by
51.3%. Womenswear now represents 43.2% of our total sales compared with 39.1%
in the corresponding period last year. Sales of Ted Baker menswear in the
period increased by 24%, helped by the continued development of the Endurance
collection. Other collections, comprising Teddy Boy and Teddy Girl, shoes and
homeware, increased by 162% to #1.9m (2000: #725,000) and now represent 6.8%
of sales (2000: 3.7%).
Appointment of non-executive director
I am delighted to announce the appointment to the Board of Robert Breare as a
non-executive director. Following a successful period in the hotel sector
where he led the development of Arcadian International Plc, Robert is
currently Chief Executive of Noble House Group which is pursuing opportunities
in the hospitality and pub sectors. He holds a number of other non-executive
positions. We look forward to his active involvement in Ted Baker and we
anticipate that his significant experience of consumer-facing businesses,
particularly within our own target markets, will prove invaluable.
CURRENT TRADING AND PROSPECTS
Our autumn/winter collections are selling strongly and have been well
received. In the seven weeks to 29 September total retail sales were 58.7%
ahead of the same period last year and UK wholesale sales were 81.2% ahead.
The excellent retail performance reflects in part the introduction of our
autumn / winter collections earlier than in previous years and the opening of
one new store since the period end. Retail margins have also improved compared
to last year. The wholesale sales performance has benefited from the launch of
the Ted Baker 'Jean' collection which has been well received to date and the
earlier delivery of our autumn /winter collections. The wholesale sales mix
following the period end has given rise to an improvement in the wholesale
margin. We expect the margins for the financial year as a whole to exceed
those achieved in the first half.
We have traded well since the end of the first half and, subject to any
unforeseen, external, factors we look forward to a successful outcome for the
year and the continued development of the Ted Baker brand.
Brian North
4 October 2001
Consolidated Profit and Loss Account
For the 28 weeks ended 11 August 2001
unaudited 28 unaudited 28 audited
weeks weeks year
ended ended ended
11 August 2001 12 August 27 January
#'000 2000 2001
#'000 #'000
Turnover 27,767 19,851 46,999
Cost of sales (12,288) (8,354) (19,719)
---------- ---------- ----------
Gross profit 15,479 11,497 27,280
Distribution costs (8,752) (6,029) (13,401)
Administrative expenses (4,740) (3,504) (6,520)
Other operating income 837 234 1,004
---------- ---------- ----------
Operating profit 2,824 2,198 8,363
Net interest payable (287) (55) (208)
---------- ---------- ----------
Profit on ordinary activities 2,537 2,143 8,155
before taxation
Tax on profit on ordinary (800) (625) (2,308)
activities
---------- ---------- ----------
Profit on ordinary activities 1,737 1,518 5,847
after taxation
Minority interests (2) (1) (13)
Dividends (1,103) (997) (2,889)
---------- ---------- ----------
Retained profit for the period 632 520 2,945
====== ====== ======
Earnings per share Note 2 4.2p 3.7p 14.3p
Diluted earnings per share Note 2 4.1p 3.6p 13.8p
Consolidated Balance Sheet
as at 11 August 2001
unaudited unaudited audited
11 August 12 August 27 January
2001 2000 2001
#'000 #'000 #'000
Fixed assets
Tangible assets 12,489 11,184 11,786
Investments - own shares 482 313 488
-------- -------- --------
12,971 11,497 12,274
-------- -------- --------
Current assets
Stock 15,024 9,862 12,654
Debtors 6,451 3,688 5,838
Cash at bank and in hand 479 267 313
-------- -------- --------
21,954 13,817 18,805
Creditors : amounts falling due within 1 year (21,416) (14,838) (18,204)
-------- -------- --------
Net current assets/ (liabilities) 538 (1,021) 601
-------- -------- --------
Total assets less current liabilities 13,509 10,476 12,875
Provisions for liabilities and charges - (28) -
-------- -------- --------
Net assets 13,509 10,448 12,875
-------- -------- --------
Capital and reserves
Called up share capital 2,063 2,063 2,063
Other reserve 910 910 910
Profit and loss account * 10,471 7,427 9,839
-------- -------- --------
Equity shareholders' funds 13,444 10,400 12,812
Minority interests 65 48 63
-------- -------- --------
13,509 10,448 12,875
===== ===== =====
* includes exchange movements of #Nil
(28 weeks to 12 August 2000 #9,000; year ended 27 January 2001 -#4,000)
Consolidated Cash Flow Statement
for the 28 weeks ended 11 August 2001
unaudited unaudited audited
28 weeks 28 weeks year
ended ended ended
11 August 12 August 27 January
2001 2000 2001
#'000 #'000 #'000
Net cash (outflow)/inflow from operating note (1,116) 2,324 6,861
activities 3a
Returns on investments and servicing of
finance
Interest received 19 28 34
Interest paid (306) (83) (210)
Taxation (850) (605) (2,320)
Capital expenditure note (1,814) (3,330) (4,882)
3d
Equity dividends paid (1,898) (1,719) (2,741)
---------- ---------- ----------
Cash outflow before financing (5,965) (3,385) (3,258)
Loan repayment - - (200)
---------- ---------- ----------
Decrease in cash (5,965) (3,385) (3,458)
====== ====== ======
Notes to the Interim Financial Statements
1. Basis of preparation
The consolidated interim financial statements have been prepared under the
historical cost convention and in accordance with applicable accounting
standards. The accounting policies are consistent with those set out in the
financial statements of Ted Baker PLC for the 52 weeks ended 27 January 2001.
The financial information in this report does not constitute statutory
accounts and does not comprise the group's financial statements for the 52
weeks ended 27 January 2001. The financial statements for Ted Baker PLC for
the 52 weeks ended 27 January 2001 have been delivered to the Registrar of
Companies. The auditors' report on these financial statements was unqualified
and did not include a statement under Section 237 (2) or (3) of the Companies
Act 1985.
2. Earnings per share
Earnings per share for the 28 weeks ended 11 August 2001, the 52 weeks ended
27 January 2001 and for the 28 weeks ended 12 August 2000 have been calculated
on profit on ordinary activities after taxation and on the weighted average
number of ordinary shares outstanding, being 40,720,156 ordinary shares for
the 28 weeks ended 11 August 2001, 40,359,774 shares for the 28 weeks ended 12
August 2000 and 40,520,401 shares for the 52 weeks ended 27 January 2001. Own
shares held by employee benefit trusts have been eliminated from the weighted
number of ordinary shares and dividend income arising from these holdings has
been eliminated from the profit on ordinary activities after taxation and
minority interests.
Diluted earnings per share are based on a weighted average number of shares of
41,758,186 for the 28 weeks ended 11 August 2001, 41,848,933 for the 28 weeks
ended 12 August 2000 and 42,011,613 for the 52 weeks ended 27 January 2001.
3. Notes to the Consolidated Cashflow Statement
for the 28 weeks ended 11 August 2001
28 weeks 28 weeks Year
ended ended ended
11 August 12 August 27 January
2001 2000 2001
#'000 #'000 #'000
a) Reconciliation of operating profit to net
cash (outflow)/inflow from
operating activities
Operating profit 2,824 2,198 8,363
Depreciation charges 1,122 862 1,832
(Profit) / loss on sale of tangible fixed (2) 56 59
assets
Increase in stock (2,369) (1,396) (4,188)
Increase in debtors (616) (445) (2,595)
(Decrease) / increase in creditors (2,075) 1,056 3,425
Decrease in provisions - (7) (35)
---------- ---------- ----------
(1,116) 2,324 6,861
====== ====== ======
Continued/......
Notes to the Consolidated Cashflow Statement
for the 28 weeks ended 11 August 2001
28 weeks 28 weeks Year
ended ended ended
11 August 12 August 27 January
2001 2000 2001
#'000 #'000 #'000
b) Analysis of movements in cash
during the year
Balance at beginning of the period (3,491) (33) (33)
Net cash outflow (5,965) (3,385) (3,458)
Exchange difference 3 - -
---------- ---------- ----------
Balance at end of period (9,453) (3,418) (3,491)
====== ====== ======
c) Analysis of the balance of cash as shown
in the balance sheet
Cash at bank and in hand 479 267 313
Bank overdraft (9,932) (3,685) (3,804)
---------- ---------- ----------
(9,453) (3,418) (3,491)
====== ====== ======
d) Capital expenditure
Payments to acquire tangible fixed assets (1,826) (3,551) (5,237)
Receipts from sale of tangible fixed assets 6 49 179
Sale of own shares 6 176 176
Purchase of investments - (4) -
---------- ---------- ----------
(1,814) (3,330) (4,882)
====== ====== ======
4. Interim Report
This interim report will be sent by post to all registered shareholders.
Copies will be available to the public from the Company Secretary at the
registered office: Ted Baker PLC, The Ugly Brown Building, 6a St Pancras Way,
London NW1 OTB.
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