TIDMTED
RNS Number : 1686M
Ted Baker PLC
11 October 2016
Ted Baker Plc
("Ted Baker", the "Group")
Interim Results Announcement for the 28 weeks ended 13 August
2016
'Good performance across all channels despite challenging
trading conditions'
28 weeks 28 weeks
ended ended
Highlights 13 August 15 August
2016 2015 Change
Group Revenue GBP259.5m GBP226.8m 14.4%
Profit Before Tax GBP21.5m GBP17.8m 20.5%
Basic EPS 37.1p 29.8p 24.5%
Interim Dividend 14.8p 13.2p 12.1%
-- Group revenue up 14.4% (10.7% in constant currency) to GBP259.5m
-- Retail sales including e-commerce up 13.6% (9.6% in constant currency)
-- UK and Europe retail sales up 8.5% (6.7% in constant currency) to GBP131.2m
-- North America retail sales up 28.7% (18.8% in constant currency) to GBP51.1m
-- Asia retail sales up 15.8% (6.5% in constant currency) to GBP8.8m
-- E-commerce sales up 29.7% (28.0% in constant currency) to GBP29.7m
-- Planned expansion continued with:
-- Two new stores in the US, one new store in each of Canada and
China, and one new outlet in Canada
-- Further concessions with leading department stores across the UK, Europe, and Asia
-- Licensee store openings in Azerbaijan, Egypt, Mexico, South Africa, Taiwan and Vietnam
-- Wholesale sales up 16.7% (13.7% in constant currency) to GBP68.4m
-- Licence income up 23.2% to GBP7.9m
Commenting, Ray Kelvin CBE, Founder and Chief Executive,
said:
'Ted Baker continues to perform well across all distribution
channels despite challenging trading conditions across our markets.
Our continued growth and development reflects the strength of the
Ted Baker brand, our business model and the skill, innovation and
passion of our global teams.
We remain firmly focused on the long-term development of the Ted
Baker brand and are continuing to invest in our infrastructure and
people to support the future growth of our business in both new and
existing markets.'
This announcement contains inside information.
Enquiries:
Ted Baker Plc Tel: 020 7796 4133
Ray Kelvin CBE, Founder and Chief Executive
Lindsay Page, Chief Operating Officer and Group Finance Director
Charles Anderson, Finance Director and Company Secretary
Hudson Sandler Tel: 020 7796 4133
Alex Brennan
Michael Sandler
Fern Duncan
www.tedbaker.com
www.tedbakerplc.com
Media images available for download at:
http://www.tedbakerplc.com/ted/en/mediacentre/imagelibrary
Notes to Editors
Ted Baker Plc - "No Ordinary Designer Label"
Ted Baker is a leading global lifestyle brand distributing
across five continents through its three main distribution
channels: retail (including e-commerce); wholesale; and
licensing.
Ted Baker has 470 stores, concessions and outlets worldwide
comprising: 186 in the UK; 97 in continental Europe; 106 in North
America; 72 in the Middle East, Asia and Africa; and 9 in
Australasia.
We offer a wide range of collections including: Menswear;
Womenswear; Phormal; Endurance; Accessories; Audio; Bedding;
Childrenswear; Crockery; Eyewear; Footwear; Fragrance and Skinwear;
Gifting and Stationery; Jewellery; Lingerie and Sleepwear; Luggage;
Neckwear; Rugs; Suiting; Technical Accessories; Tiles; and
Watches.
Development of the Brand
Our strategy is to further develop as a leading global lifestyle
brand, based on three main elements:
-- considered expansion of our collections. We review our
collections continually to ensure we react to trends and meet our
customers' expectations. In addition, we look for opportunities to
extend the breadth of collections and enhance our offer;
-- controlled distribution through three main channels: retail
(including e-commerce), wholesale, and licensing. We consider each
new opportunity to ensure it is right for the brand and will
deliver margin-led growth; and
-- carefully managed development of existing and new
international markets. We continue to manage growth in existing
territories while considering new territories for expansion.
Underlying our strategy is an emphasis on design, product
quality and attention to detail, which is delivered by the passion,
commitment and dedication of our teams, licence partners and
wholesale customers.
Chairman's Statement
I am pleased to report a good performance for the first half of
the year across all channels despite challenging external trading
conditions, reflecting the strength of the Ted Baker brand and our
business model. This resulted in a 14.4% (10.7% in constant
currency) increase in Group revenue for the 28 weeks ended 13
August 2016 (the "period") to GBP259.5m (2015: GBP226.8m) and a
20.5% increase in profit before tax to GBP21.5m (2015:
GBP17.8m).
The retail channel performed well, with retail sales including
e-commerce up 13.6% to GBP191.1m (9.6% in constant currency) on a
9.7% increase in average retail square footage. Our e-commerce
business is an integral and increasingly important component within
our retail proposition and has performed very well, delivering
sales growth of 29.7%. Geographic expansion continued with store
openings across all territories. We continue to invest to develop
brand awareness in newer markets.
Wholesale sales increased by 16.7% (13.7% in constant currency)
to GBP68.4m with a good performance from our UK business and a
strong performance from our North American business.
Licence income increased by 23.2% to GBP7.9m as both our product
and territorial licences continued to perform well. During the
period, our existing licence partners opened further stores in
Azerbaijan, Egypt, Mexico and Taiwan. We also opened new licence
partner stores in South Africa and Vietnam and are encouraged by
their performance at this early stage.
In September 2016, we successfully launched the Microsoft
Dynamics AX system across our North American business. We will
continue the roll-out to our other territories over the current
year and early next year, which will allow us to enhance
efficiency, to streamline our operations and to support the
evolution of the business.
In October 2016, we took our first delivery of inventory into
our new distribution facility in the UK. Over the coming months, we
will transition operations from our three current distribution
centres into this facility. This will become our European
distribution centre handling all operations for our retail
(including e-commerce) and wholesale business across the UK and
Europe, supporting our long term growth strategy.
Financial Results
Group revenue increased by 14.4% (10.7% in constant currency) to
GBP259.5m (2015: GBP226.8m) for the 28 weeks ended 13 August 2016.
The composite gross margin increased to 58.9% (2015: 57.6%), mainly
due to an increase in the retail gross margin.
Distribution costs, which comprise the cost of retail operations
and distribution centres increased by 22.7% (17.7% in constant
currency) to GBP103.7m (2015: GBP84.6m). As a percentage of sales
they increased to 40.0% (2015: 37.3%) due to the dual running costs
arising from our new European distribution centre.
Administrative expenses, including the performance-related bonus
provision and dual system running costs, increased by 5.4% (4.1% in
constant currency). Excluding the employee performance related
bonus provision of GBP0.0m (2015: GBP1.4m), administrative expenses
increased by 9.9% (8.7% in constant currency) to GBP35.5m (2015:
GBP32.3m) and as a percentage of sales decreased to 13.7% (2015:
14.2%).
Dual running costs incurred in respect of our new distribution
centre and the systems roll-out were GBP2.0m in the first half of
the year. We would expect to incur similar costs in the second half
of the year.
The net foreign exchange gain during the period of GBP1.2m
(2015: loss of GBP0.7m) was due to the translation of monetary
assets and liabilities denominated in foreign currencies following
the devaluation of sterling that followed the UK's EU referendum
result.
Net interest payable during the period was GBP1.5m (2015:
GBP0.6m). The increase was largely due to the interest payable on
the term loan that financed the acquisition of the freehold of the
Ugly Brown Building in January 2016.
Profit before tax increased by 20.5% to GBP21.5m (2015:
GBP17.8m). This profit growth was in part aided by foreign exchange
gains of GBP1.2m (2015: loss of GBP0.7m). Basic earnings per share
increased by 24.5% to 37.1p (2015: 29.8p).
The effective tax rate of 24.0% (2016 full year effective rate:
24.6%) is higher than the UK corporation tax rate for the period of
20%, largely due to higher overseas tax rates and the
non-recognition of losses in overseas territories where the brand
is still in its development phase. On 1 April 2015, the UK
corporation tax rate fell from 21% to 20% and further reductions to
19% from 1 April 2017 and to 17% from 1 April 2020 have been
substantively enacted.
The net decrease in cash and cash equivalents of GBP32.9m (2015:
GBP34.7m) primarily reflected an increase in working capital and
further capital expenditure to support our long-term
development.
Total working capital, which comprises inventories, trade and
other receivables and trade and other payables, increased by
GBP18.2m to GBP132.5m (2015: GBP114.3m). This was mainly driven by
an increase in inventories of GBP20.6m to GBP135.6m (2015:
GBP115.0m) reflecting the growth of our business, stock on hand for
our wholesale customers and licence partners, and some earlier
phasing of stock deliveries between the first and second half of
the year.
The increase in trade and other receivables of GBP12.5m to
GBP56.4m (2015: GBP43.9m) was driven by the growth in our wholesale
business and the impact of foreign exchange rates on the
translation of overseas subsidiaries. Trade and other payables
increased by GBP14.9m to GBP59.5m (2015: GBP44.6m) as a consequence
of the timing of stock intake and other payments as well as the
foreign exchange impact explained above.
Capital expenditure of GBP21.5m (2015: GBP17.7m) comprises the
costs of opening and refurbishing stores, concessions and outlets.
It also reflects the initial phases of the fit-out of our new
European distribution centre as well as the on-going investment in
business-wide systems to support our continued growth. We expect
full year capital expenditure to be in line with previous guidance
of GBP45m, subject to the timing of planned openings in the early
stages of next year.
Borrowing Facilities
During the period, the Group agreed an extension of its
multi-currency revolving credit facility with the Royal Bank of
Scotland and Barclays. A new agreement was signed on 31 May 2016
which increased the Group's committed borrowing facility from
GBP85m to GBP110m expiring in March 2018.
This increased facility provides the resources to fund the
planned capital expenditure to support the Group's long-term growth
strategy. The new borrowing facility is on the same terms and
contains the same covenants as the previous facility.
Dividends
The Board has declared an interim dividend of 14.8p (2015:
13.2p), representing an increase of 12.1%, which will be payable on
18 November 2016 to shareholders on the register at the close of
business on 21 October 2016.
People
The performance in the period is testament to our talented teams
across the world, whose commitment and passion are key to our
success. I would like to take this opportunity to thank all of my
colleagues for their continued hard work as we continue to grow the
business and develop Ted Baker as a global lifestyle brand.
Global Group Performance
28 weeks 28 weeks Variance Constant
ended ended currency
13 August 15 August variance
2016 2015
----------- ------------------------- ----------- ----------- --------- ----------
Group Revenue GBP259.5m GBP226.8m 14.4% 10.7%
----------- ------------------------- ----------- ----------- --------- ----------
Gross Margin 58.9% 57.6% +130bps
------------------------------------- ----------- ----------- --------- ----------
Operating contribution* 8.3% 8.3% -
------------------------------------- ----------- ----------- --------- ----------
Profit before
tax as a % of
revenue 8.3% 7.9% +40bps
------------------------------------- ----------- ----------- --------- ----------
Retail Revenue GBP191.1m GBP168.2m 13.6% 9.6%
----------- ------------------------- ----------- ----------- --------- ----------
Gross Margin 65.6% 64.0% +160bps
------------------------------------- ----------- ----------- --------- ----------
Average square
footage** 381,441 347,793 9.7%
------------------------------------- ----------- ----------- --------- ----------
Closing square
footage** 387,086 355,324 8.9%
------------------------------------- ----------- ----------- --------- ----------
Sales per square
foot*** GBP423 GBP418 1.2% (2.7%)
------------------------------------- ----------- ----------- --------- ----------
Wholesale Revenue GBP68.4m GBP58.6m 16.7% 13.7%
----------- ------------------------- ----------- ----------- --------- ----------
Gross margin 40.1% 39.2% 90bps
------------------------------------- ----------- ----------- --------- ----------
Licence
income Revenue GBP7.9m GBP6.4m 23.2%
----------- ------------------------- ----------- ----------- --------- ----------
*Operating contribution is defined as operating profit before
exceptional items as a percentage of revenue.
**Excludes license partner stores
*** Excludes e-commerce sales
Retail
Our retail channel comprises stores, concessions and e-commerce,
which is now an integral part of our retail experience. We operate
stores and concessions across the UK, Europe, North America and
Asia as well as localised e-commerce sites in the UK, continental
Europe, US, Canada and Australia. We also have e-commerce
businesses with some of our concession partners.
Retail sales were up 13.6% (9.6% in constant currency) to
GBP191.1m (2015: GBP168.2m), despite a challenging trading
environment across all of our markets. This growth was driven by
continued investment in new stores and a strong e-commerce
performance, where sales grew 29.7% to GBP29.7m (2015: GBP22.9m)
and represented 15.5% (2015: 13.6%) of total retail sales. We have
continued to develop our retail proposition with continued
investment in each of our e-commerce sites, aiming to provide a
more relevant customer experience through improved design,
performance and personalised content. We also launched our first
language specific site in Germany and have been very pleased with
its performance. Average retail square footage increased by 9.7% to
381,441 sq ft (2015: 347,793 sq ft) and retail sales per square
foot increased 1.2% (decrease of 2.7% in constant currency) to
GBP423 (2015: GBP418).
The retail gross margin increased to 65.6% (2015: 64.0%) driven
primarily by an improved full price sell through.
Retail operating costs increased by 20.6% (15.6% in constant
currency) to GBP100.8m (2015: GBP83.6m), and as a percentage of
retail sales increased to 52.8% (2015: 49.7%). As anticipated, an
element of the increase in retail operating costs is due to dual
running costs as a result of the new European distribution centre,
but also included some store pre-opening costs in our North
American market.
Wholesale
Our wholesale business in the UK serves countries across the
world, particularly in the UK and Europe, as well as supplying
products to stores operated by our territorial licence partners. In
addition, we operate a wholesale business in North America serving
the US and Canada.
Wholesale sales increased by 16.7% (13.7% in constant currency)
to GBP68.4m (2015: GBP58.6m) reflecting a good performance from our
UK business and a strong result from our North American
business.
The wholesale gross margin increased to 40.1% (2015: 39.2%).
This was largely due to a proportionate increase in sales to our
trustees, which carry a higher margin.
Licence Income
We operate both territorial and product licences. Our
territorial licences cover selected countries in Europe, North
America, the Middle East, Asia, Australasia and Africa, where our
partners operate licensed retail stores and, in some territories,
wholesale operations. Our product licences cover Audio, Bedding,
Childrenswear, Crockery, Eyewear, Footwear, Fragrance and Skinwear,
Gifting and Stationery, Jewellery, Lingerie and Sleepwear, Luggage,
Neckwear, Rugs, Suiting, Technical Accessories, Tiles and
Watches.
Licence income was up 23.2% to GBP7.9m (2015: GBP6.4m) with both
product and territorial licences performing well. There were
notable performances from our product licensees in Childrenswear,
Eyewear, Footwear and Suiting. In July 2016, we opened our first
store in Vietnam with our new licence partner Maison, and in August
2016, we opened our first store in South Africa with our new
licence partner Stuttafords. We are encouraged by their performance
to date. An additional store opening is planned in South Africa for
later in the year.
Collections
Ted Baker Womenswear performed well with sales up 13.8% to
GBP148.9m (2015: GBP130.9m). Ted Baker Menswear delivered a good
performance with sales increasing 15.3% to GBP110.6m (2015:
GBP95.9m). We are pleased with the positive reactions to the
collections both in the UK and internationally.
Womenswear represented 57.4% of total sales (2015: 57.7%) during
the period and Menswear represented 42.6% of total sales (2015:
42.3%), which is broadly representative of the division in retail
selling space.
Geographic Performance
United Kingdom & Europe
28 weeks 28 weeks Variance Constant
ended ended currency
13 August 15 August variance
2016 2015
------------------- ----------- ----------- --------- ----------
Retail Revenue* GBP131.2m GBP120.9m 8.5% 6.7%
------------------- ----------- ----------- --------- ----------
Average square
footage* 245,377 233,435 5.1% -
------------------- ----------- ----------- --------- ----------
Closing square
footage* 247,088 235,633 4.9% -
------------------- ----------- ----------- --------- ----------
Sales per square
foot** GBP432 GBP432 - (2.0%)
------------------- ----------- ----------- --------- ----------
Wholesale revenue GBP46.6m GBP43.9m 6.2% 6.2%
------------------- ----------- ----------- --------- ----------
Own stores 38 37 1 -
------------------- ----------- ----------- --------- ----------
Concessions 229 218 11 -
------------------- ----------- ----------- --------- ----------
Outlets 13 12 1 -
------------------- ----------- ----------- --------- ----------
Partner stores 3 3 - -
------------------- ----------- ----------- --------- ----------
Total 283 270 13 -
------------------- ----------- ----------- --------- ----------
*Excludes licence partner stores
** Excludes e-commerce sales
Retail sales in the period in the UK and Europe increased 8.5%
(6.7% in constant currency) to GBP131.2m (2015: GBP120.9m) despite
tough trading conditions and recent events in northern Europe.
E-commerce sales increased by 26.5% to GBP25.3m (2015: GBP20.0m)
further demonstrating how e-commerce sales are an integral part of
the retail proposition in the UK and European markets. We launched
our first language specific site in Germany and are very pleased
with its performance.
As a percentage of UK and Europe retail sales, e-commerce sales
represent 19.3% (2015: 16.5%).
During the period, we opened further concessions with premium
department stores in the UK, France, Germany and Spain. We are
pleased with their performance and remain positive about growth
opportunities for our brand in these markets.
Sales from our UK wholesale business increased 6.2% to GBP46.6m
(2015: GBP43.9m). This reflected a good performance from sales to
trustees, including our wholesale export business and the supply of
product to our retail licence partners.
North America
28 weeks 28 weeks Variance Constant
ended ended currency
13 August 15 August variance
2016 2015
------------------------- ----------- ----------- --------- ----------
Retail Revenue* GBP51.1m GBP39.7m 28.7% 18.8%
------------------------- ----------- ----------- --------- ----------
Average square footage* 107,692 89,405 20.5%
------------------------- ----------- ----------- --------- ----------
Closing square footage* 112,317 92,585 21.3%
------------------------- ----------- ----------- --------- ----------
Sales per square
foot** GBP434 GBP412 5.3% (2.9%)
------------------------- ----------- ----------- --------- ----------
Wholesale revenue GBP21.8m GBP14.6m 49.3% 36.6%
------------------------- ----------- ----------- --------- ----------
Own stores 28 21 7 -
------------------------- ----------- ----------- --------- ----------
Concessions 55 51 4 -
------------------------- ----------- ----------- --------- ----------
Outlets 11 6 5 -
------------------------- ----------- ----------- --------- ----------
Partner stores 12 1 11 -
------------------------- ----------- ----------- --------- ----------
Total 106 79 27 -
------------------------- ----------- ----------- --------- ----------
*Excludes licence partner stores
** Excludes e-commerce sales
We continue to be pleased with our progress across the retail
and wholesale channels in North America, despite well documented
challenges facing the North American retail market, which has seen
increased levels of promotional activity and a fall in tourism.
This has resulted in a challenging environment for not only our
stores but also for our key trading partners. However, we remain
confident that the Ted Baker brand is becoming more established and
continuing to gain recognition in this territory.
Sales from our retail division increased by 28.7% (18.8% in
constant currency) to GBP51.1m (2015: GBP39.7m) driven by our
continued expansion. In the period, we opened two new stores in
each of New York and Seattle, and a new store in Ottawa and an
outlet in Vancouver. We also opened a further five concessions in
Mexico with our licence partner.
Our e-commerce business delivered a strong performance with
sales increasing by 51.7% (43.7% constant currency) to GBP4.4m
(2015: GBP2.9m). As a percentage of North America retail sales,
e-commerce sales represent 8.6% (2015: 7.1%).
Sales from our North American wholesale business increased by
49.3% (36.6% in constant currency), to GBP21.8m (2015: GBP14.6m)
reflecting the increased brand recognition in this territory.
Middle East, Asia, Africa & Australasia
28 weeks 28 weeks Variance Constant
ended ended currency
13 August 15 August variance
2016 2015
------------------------ ----------- ----------- --------- ----------
Retail Revenue GBP8.8m GBP7.6m 15.8% 6.5%
------------------------ ----------- ----------- --------- ----------
Average square footage 28,372 24,953 13.7%
------------------------ ----------- ----------- --------- ----------
Closing square footage 27,681 27,106 2.1%
------------------------ ----------- ----------- --------- ----------
Sales per square
foot GBP310 GBP306 1.3% (6.4%)
------------------------ ----------- ----------- --------- ----------
Own stores 8 8 - -
------------------------ ----------- ----------- --------- ----------
Concessions 10 8 2 -
------------------------ ----------- ----------- --------- ----------
Outlets 3 3 - -
------------------------ ----------- ----------- --------- ----------
Partner stores 60 48 12 -
------------------------ ----------- ----------- --------- ----------
Total 81 67 14 -
------------------------ ----------- ----------- --------- ----------
We continue to develop the Ted Baker brand across the Middle
East, Asia, Africa and Australasia through our retail and licensing
channels.
In Asia, we remain positive about the long term opportunities in
this territory. However, as has been widely reported, the trading
environment continues to be challenging. Retail sales in Asia
increased 15.8% (6.5% in constant currency) to GBP8.8m (2015:
GBP7.6m). During the period, we opened a store in Beijing and
concessions in China and Japan. We closed a store in Hong Kong in
July 2016 which will be relocated in the second half of the
financial year.
Our licensed stores across the Middle East, Asia and Africa
continued to perform well. Our existing licence partners opened new
stores in Azerbaijan, Egypt, and Taiwan and we opened stores with
new licence partners in South Africa and Vietnam during the period.
As at 13 August 2016, we operated a total of 51 partner stores
(2015: 41).
The joint venture with our Australian licence partner, Flair
Industries Pty Ltd, continues to perform well. As at 13 August
2016, we operated 9 stores in Australasia (2015: 7 stores).
Current Trading and Outlook
Retail
We are pleased with the reaction to our Autumn/Winter
collections, however, on-going external factors impacting trading
across our established markets have meant that conditions remain
challenging.
In the UK and Europe, we have continued our expansion with
concession openings in the UK and Germany. We plan to open an
outlet in Spain, and further concessions in the UK, France, Germany
and Spain later this year.
In North America, we have continued our expansion with the
relocation of our New York Soho store and the opening of a new
store in Calgary. We remain focused on developing our presence
further in this market with plans to open a new store in Atlanta
and an additional store in Miami.
In Asia, we have opened two further concessions in Japan and a
concession in China. Later in the year we will relocate one of our
Hong Kong stores and open further concessions in China. We have
closed a store in Japan in anticipation of its relocation next
financial year.
Wholesale
The good performance in our wholesale business in the first half
of the year is expected to continue for the remainder of the year.
As a result, we would expect low double-digit sales growth (in
constant currency) for the full year.
Licence Income
Our product and territorial licences continue to perform well,
with further store openings in Dubai and Mexico and we also plan to
open further stores in Bahrain, Indonesia, Saudi Arabia and South
Africa. We have signed a new territorial licence agreement with a
partner in India and plan to open stores in the next financial
year.
Outlook
The Group continues to perform well despite challenging trading
conditions and we remain focused on the long-term development of
Ted Baker as a global lifestyle brand. We continue to invest in
infrastructure and people to support the future growth of our
business in new and existing markets.
Whilst the Group has had a good start to the financial year, our
results for the full year will, as always, be dependent on the
second half trading period. Underpinned by the strength of the Ted
Baker brand, our business model and balanced distribution channels,
we remain confident of delivering continued growth and
development.
Despite the challenging conditions, the Board is confident of
making further progress for the full year and we intend to make our
next trading update, covering the period since the start of the
second half of the financial year, in mid-November.
David Bernstein CBE
Non-Executive Chairman
11 October 2016
Condensed Group Income Statement
For the 28 weeks ended 13 August 2016
Unaudited 28 weeks Unaudited Audited
ended 28 weeks 52 weeks ended
13 August ended 30 January
2016 15 August 2016
2015
Note GBP'000 GBP'000 GBP'000
Revenue 2 259,460 226,755 456,169
Cost of sales 2 (106,687) (96,148) (183,147)
------------------- ----------- ----------------
Gross profit 2 152,773 130,607 273,022
Distribution costs (103,744) (84,568) (169,762)
Administrative expenses (35,540) (33,727) (57,435)
Licence income 7,904 6,413 14,384
Other operating income 125 83 (840)
------------------- ----------- ----------------
Operating profit 2 21,518 18,808 59,369
Finance income 3 1,265 22 531
Finance expenses 3 (1,572) (1,338) (1,931)
Share of profit of jointly controlled entity, net
of tax 260 323 695
------------------- ----------- ----------------
Profit before tax 2 21,471 17,815 58,664
Income tax expense 6 (5,153) (4,721) (14,429)
------------------- ----------- ----------------
Profit for the period 16,318 13,094 44,235
------------------- ----------- ----------------
Earnings per share 4
Basic 37.1p 29.8p 100.6p
Diluted 36.6p 29.4p 99.3p
Condensed Group Statement of Comprehensive Income
For the 28 weeks ended 13 August 2016
Unaudited 28 weeks Unaudited Audited
ended 28 weeks 52 weeks ended
13 August ended 30 January
2016 15 August 2016
2015
GBP'000 GBP'000 GBP'000
Profit for the period 16,318 13,094 44,235
------------------- ----------- ----------------
Other comprehensive income / (loss)
Items that may be reclassified subsequently to the income
statement:
Net effective portion of changes in fair value of cash flow
hedges 10,656 (1,886) 951
Net change in fair value of cash flow hedges transferred to
profit or loss (2,394) (92) (669)
Net exchange rate movement 2,931 (818) 2,599
------------------- ----------- ----------------
Other comprehensive profit / (loss) for the period, net of tax 11,193 (2,796) 2,881
Total comprehensive income for the period 27,511 10,298 47,116
------------------- ----------- ----------------
Condensed Group Statement of Changes in Equity - Unaudited
For the 28 weeks ended 13 August 2016
Total equity
attributable
Cash flow to equity
hedging Translation Retained shareholders
Share capital Share premium reserve reserve earnings of the parent
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 30
January 2016 2,199 9,617 1,650 2,311 156,822 172,599
Comprehensive
income for the
period
Profit for the
period - - - - 16,318 16,318
Exchange
differences on
translation of
foreign
operations - - - 3,931 - 3,931
Current tax on
foreign
currency
translation - - - (1,000) - (1,000)
Effective
portion of
changes in
fair value of
cash flow
hedges - - 9,337 - - 9,337
Net change in
fair value of
cash flow
hedges
transferred to
profit or loss - - (2,394) - - (2,394)
Deferred tax
associated
with movement
in hedging
reserve - - 1,319 - - 1,319
--------------- --------------- --------------- --------------- --------------- ---------------
Total
comprehensive
income for the
period - - 8,262 2,931 16,318 27,511
--------------- --------------- --------------- --------------- --------------- ---------------
Transactions
with owners
recorded
directly in
equity
Increase in
issued share
capital 4 280 - - - 284
Share-based
payments
charges - - - - 1,039 1,039
Movement on
current and
deferred tax
on share-based
payments - - - - (332) (332)
Dividends paid - - - - (15,215) (15,215)
--------------- --------------- --------------- --------------- --------------- ---------------
Total
transactions
with owners 4 280 - - (14,508) (14,224)
--------------- --------------- --------------- --------------- --------------- ---------------
Balance at 13
August 2016 2,203 9,897 9,912 5,242 158,632 185,886
=============== =============== =============== =============== =============== ===============
Condensed Group Statement of Changes in Equity - Unaudited
For the 28 weeks ended 15 August 2015
Total equity
attributable
Cash flow to equity
hedging Translation Retained shareholders
Share capital Share premium reserve reserve earnings of the parent
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 31
January 2015 2,196 9,331 1,368 (288) 127,967 140,574
Comprehensive
income for the
period
Profit for the
period - - - - 13,094 13,094
Exchange
differences on
translation of
foreign
operations - - - (1,120) - (1,120)
Current tax on
foreign
currency
translation - - - 302 - 302
Effective
portion of
changes in
fair value of
cash flow
hedges - - (2,382) - - (2,382)
Net change in
fair value of
cash flow
hedges
transferred to
profit or loss - - (92) - - (92)
Deferred tax
associated
with movement
in hedging
reserve - - 496 - - 496
-------------- -------------- --------------- ---------------- ---------------- ---------------
Total
comprehensive
income for the
period - - (1,978) (818) 13,094 10,298
-------------- -------------- --------------- ---------------- ---------------- ---------------
Transactions
with owners
recorded
directly in
equity
Increase in
issued share
capital 2 259 - - - 261
Share based
payments
charges - - - - 1,026 1,026
Movement on
current and
deferred tax
on share-based
payments - - - - 1,715 1,715
Dividends paid - - - - (12,739) (12,739)
-------------- -------------- --------------- ---------------- ---------------- ---------------
Total
transactions
with owners 2 259 - - (9,998) (9,737)
-------------- -------------- --------------- ---------------- ---------------- ---------------
Balance at 15
August 2015 2,198 9,590 (610) (1,106) 131,063 141,135
============== ============== =============== ================ ================ ===============
Condensed Group Statement of Changes in Equity - Audited
For the 52 weeks ended 30 January 2016
Share Share Cash Translation Retained Total
capital Premium flow Reserve earnings equity
hedging attributable
reserve to equity
shareholders
of the
parent
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 31 January
2015 2,196 9,331 1,368 (288) 127,967 140,574
Comprehensive income
for the period
Profit for the
period - - - - 44,235 44,235
Exchange differences
on translation
of foreign operations - - - 3,242 - 3,242
Current tax on
foreign currency
translation - - - (643) - (643)
Effective portion
of changes in fair
value of cash flow
hedges - - 996 - - 996
Net change in fair
value of cash flow
hedges transferred
to profit or loss - - (669) - - (669)
Deferred tax associated
with movement in
hedging reserve - - (45) - - (45)
Total comprehensive
income for the
period - - 282 2,599 44,235 47,116
========= ========= ========= ============ ========== ==============
Transactions with
owners recorded
directly in equity
Increase in issued
share capital 3 286 - - - 289
Share based payments
charges - - - - 2,019 2,019
Movement on current
and deferred tax
on share based
payments - - - - 1,144 1,144
Dividends paid - - - - (18,543) (18,543)
--------- --------- --------- ------------ ---------- --------------
Total transactions
with owners 3 286 - - (15,380) (15,091)
========= ========= ========= ============ ========== ==============
Balance at 30 January
2016 2,199 9,617 1,650 2,311 156,822 172,599
========= ========= ========= ============ ========== ==============
Condensed Group Balance Sheet
At 13 August 2016
Unaudited Unaudited Audited
13 August 2016 15 August 2015 30 January 2016
Note GBP'000 GBP'000 GBP'000
Non-current assets
Intangible assets 9 20,682 15,447 17,247
Property, plant and equipment 10 134,893 58,222 123,397
Investments in equity accounted investee 1,901 1,613 1,641
Deferred tax assets 7,639 6,967 6,313
Prepayments 426 412 414
---------------- ---------------- -----------------
165,541 82,661 149,012
---------------- ---------------- -----------------
Current assets
Inventories 135,649 115,048 125,323
Trade and other receivables 56,396 43,861 49,303
Amount due from equity accounted investee 925 694 563
Derivative financial assets 11 10,117 1,118 2,850
Cash and cash equivalents 8 25,525 14,354 13,295
---------------- ---------------- -----------------
228,612 175,075 191,334
---------------- ---------------- -----------------
Current liabilities
Trade and other payables (59,532) (44,611) (61,088)
Bank overdraft 8 (81,702) (68,770) (37,869)
Term loan (4,500) - (1,500)
Income tax payable (5,743) (1,977) (8,382)
Derivative financial liabilities 11 (1,228) (1,243) (352)
(152,705) (116,601) (109,191)
---------------- ---------------- -----------------
Non-current liabilities
Deferred tax liability (62) - (56)
Term loan (55,500) - (58,500)
---------------- ---------------- -----------------
(55,562) - (58,556)
---------------- ---------------- -----------------
Net assets 185,886 141,135 172,599
---------------- ---------------- -----------------
Equity
Share capital 2,203 2,198 2,199
Share premium 9,897 9,590 9,617
Other reserves 9,912 (610) 1,650
Translation reserve 5,242 (1,106) 2,311
Retained earnings 158,632 131,063 156,822
---------------- ---------------- -----------------
Total equity 185,886 141,135 172,599
---------------- ---------------- -----------------
Condensed Group Cash Flow Statement
For the 28 weeks ended 13 August 2016
Unaudited Unaudited Audited
28 weeks ended 28 weeks ended 52 weeks ended
13 August 15 August 30 January
2016 2015 2016
GBP'000 GBP'000 GBP'000
Cash generated from operations
Profit for the period 16,318 13,094 44,235
Adjusted for:
Income tax expense 5,153 4,721 14,429
Depreciation and amortisation 10,559 7,764 14,929
Impairment - - 188
Loss on disposal of property, plant & equipment 22 - 58
Share-based payments charges 1,039 1,026 2,019
Net finance expenses 307 1,316 1,400
Net change in derivative financial assets and liabilities
carried at fair value through profit
or loss 985 337 840
Share of profit in joint venture (260) (323) (695)
Decrease in non-current prepayments 31 28 52
Increase in inventories (6,608) (4,899) (12,142)
Increase in trade and other receivables (14,193) (5,706) (10,805)
Increase/(decrease) in trade and other payables 243 (12,048) 1,566
Interest paid (1,389) (640) (1,376)
Income taxes paid (8,705) (8,978) (13,127)
---------------- ---------------- ----------------
Net cash generated from operating activities 3,502 (4,308) 41,571
---------------- ---------------- ----------------
Cash flow from investing activities
Purchases of property, plant & equipment and intangibles (21,460) (17,908) (89,535)
Interest received 13 - -
Dividends received from joint venture - - 344
---------------- ---------------- ----------------
Net cash from investing activities (21,447) (17,908) (89,191)
---------------- ---------------- ----------------
Cash flow from financing activities
Proceeds from term loan - - 60,000
Dividends paid (15,215) (12,739) (18,543)
Proceeds from issue of shares 284 261 289
---------------- ---------------- ----------------
Net cash from financing activities (14,931) (12,478) 41,746
---------------- ---------------- ----------------
Net decrease in cash and cash equivalents (32,876) (34,694) (5,874)
Cash and cash equivalents at the beginning of the period (24,574) (18,824) (18,824)
Exchange rate movement 1,273 (898) 124
---------------- ---------------- ----------------
Net cash and cash equivalents at the end of the period (56,177) (54,416) (24,574)
---------------- ---------------- ----------------
Cash and cash equivalents at the end of the period 25,525 14,354 13,295
Bank overdraft at the end of the period (81,702) (68,770) (37,869)
---------------- ---------------- ----------------
Net cash and cash equivalents at the end of the period (56,177) (54,416) (24,574)
Notes to the Condensed Interim Financial Statements
For the 28 weeks ended 13 August 2016
1. Basis of preparation
a. Reporting entity
Ted Baker Plc is a company domiciled in the United Kingdom. The
condensed interim financial statements ("interim financial
statements") of Ted Baker Plc as at, and for the 28 weeks ended, 13
August 2016 comprise the Company and its subsidiaries (together
referred to as the "Group").
The Group financial statements as at, and for the 52 weeks ended
30 January 2016 are available upon request from the Company's
registered office at Ted Baker Plc, The Ugly Brown Building, 6a St.
Pancras Way, London NW1 0TB or at www.tedbakerplc.com.
b. Statement of compliance
These interim financial statements have been prepared in
accordance with "IAS 34 Interim Financial Reporting" as adopted by
the EU and the requirements of the Disclosures and Transparency
Rules. They do not include all of the information required for full
annual financial statements and should be read in conjunction with
the Group financial statements as at, and for the 52 weeks ended 30
January 2016. These interim financial statements were approved by
the Board of Directors on 11 October 2016.
The comparative figures for the 52 weeks ended 30 January 2016
are not the Company's statutory accounts for that financial year.
Those accounts have been reported on by the Company's auditors and
delivered to the registrar of companies. The report of the auditors
was (i) unqualified; (ii) did not include a reference to any
matters to which the auditors drew attention by way of emphasis
without qualifying their report; and (iii) did not contain a
statement under section 498(2) or (3) of the Companies Act 2006.
These sections address whether proper accounting records have been
kept, whether the Company's accounts are in agreement with these
records and whether the auditors have obtained all the information
and explanations necessary for the purposes of the audit.
The financial information in this document is unaudited, but has
been reviewed by the auditors in accordance with the Auditing
Practices Board guidance on Review of Interim Financial
Information.
c. Going concern
The Group financial statements for the 52 weeks ended 30 January
2016, approved by the Board on 17 March 2016, included information
on the business environment in which the Group operates, including
the factors that are likely to impact the future prospects of the
Group, together with the principal risks and uncertainties that the
Group faces. In addition, the notes to the consolidated financial
statements set out the Group's objectives, policies and processes
for managing its financial and capital risk and its exposures to
credit, market and liquidity risk. Many of the risks and
uncertainties reported are such that their potential to impact the
Group's operations are inherent and remain valid as regards to
their potential impact during the second half of the financial year
ending 28 January 2017. The impact of the economic environment in
which the Group's businesses operate is considered in the
Chairman's Statement.
The directors have prepared trading and cash flow forecasts for
a period of one year from the date of approval of these interim
financial statements. The directors have a reasonable expectation
that the Group has adequate cash headroom and expects to meet all
banking covenant requirements. Accordingly, they continue to adopt
a going concern basis in preparing the financial statements of the
Group.
d. Significant accounting policies
The accounting policies adopted in these interim financial
statements are consistent with those followed in the preparation of
the Group's annual financial statements for the 52 weeks ended 30
January 2016. Adoption of amendments to published standards and
interpretations effective for the Group for the 28 weeks ended 13
August 2016 have had no significant impact on the financial
position and performance of the Group.
2. Segment information
Segment revenue and segment result
Unaudited - 28 weeks ended 13 August 2016 Retail Wholesale Licensing Total
GBP'000 GBP'000 GBP'000 GBP'000
Revenue 191,070 68,390 - 259,460
Cost of sales (65,700) (40,987) - (106,687)
---------- ---------- ---------- ----------
Gross profit 125,370 27,403 - 152,773
Operating costs (100,808) - - (100,808)
---------- ---------- ---------- ----------
Operating contribution 24,562 27,403 - 51,965
Licence income - - 7,904 7,904
---------- ---------- ---------- ----------
Segment result 24,562 27,403 7,904 59,869
Reconciliation of segment result to profit before tax
Segment result 24,562 27,403 7,904 59,869
Other operating costs - - - (38,476)
Other operating income - - - 125
Operating profit 21,518
Net finance expense - - - (307)
Share of profit of jointly controlled entity, net of tax - - - 260
----------
Profit before tax 21,471
----------
Capital expenditure 12,087 327 - 12,414
Unallocated capital expenditure - - - 9,046
----------
Total capital expenditure 21,460
----------
Depreciation and amortisation 8,378 190 - 8,568
Unallocated depreciation and amortisation - - - 1,991
----------
Total depreciation and amortisation 10,559
----------
Segment assets 204,366 80,527 - 284,893
Deferred tax assets - - - 7,639
Derivative financial assets - - - 10,117
Intangible assets - head office - - - 17,559
Plant, property and equipment - head office - - - 70,693
Other assets - - - 3,252
----------
Total assets 394,153
----------
Segment liabilities (104,006) (37,228) - (141,234)
Income tax payable - - - (5,743)
Term loan - - - (60,000)
Other liabilities - - - (1,290)
----------
Total liabilities (208,267)
----------
Net assets 185,886
----------
Unaudited - 28 weeks ended 15 August 2015 Retail Wholesale Licensing Total
GBP'000 GBP'000 GBP'000 GBP'000
Revenue 168,167 58,588 - 226,755
Cost of sales (60,505) (35,643) - (96,148)
--------- ---------- ---------- ----------
Gross profit 107,662 22,945 - 130,607
Operating costs (83,604) - - (83,604)
--------- ---------- ---------- ----------
Operating contribution 24,058 22,945 - 47,003
Licence income - - 6,413 6,413
--------- ---------- ---------- ----------
Segment result 24,058 22,945 6,413 53,416
Reconciliation of segment result to profit before tax
Segment result 24,058 22,945 6,413 53,416
Other operating costs - - - (34,691)
Other operating expense - - - 83
----------
Operating profit 18,808
Net finance expense - - - (1,316)
Share of profit of jointly controlled entity, net of tax - - - 323
----------
Profit before tax 17,815
----------
Capital expenditure 8,773 661 - 9,434
Unallocated capital expenditure - - - 8,293
----------
Total capital expenditure 17,727
----------
Depreciation and amortisation 6,157 160 - 6,317
Unallocated depreciation and amortisation - - - 1,447
----------
Total depreciation and amortisation 7,764
----------
Segment assets 180,409 45,698 - 226,107
Deferred tax assets - - - 6,967
Derivative financial assets - - - 1,118
Intangible assets - head office - - - 11,821
Plant, property and equipment - head office - - - 9,004
Other assets - - - 2,719
Total assets 257,736
----------
Segment liabilities (84,086) (29,295) - (113,381)
Income tax payable - - - (1,977)
Other liabilities - - (1,243)
----------
Total liabilities (116,601)
----------
Net assets 141,135
----------
Audited - 52 weeks ended 30 January 2016 Retail Wholesale Licensing Total
GBP'000 GBP'000 GBP'000 GBP'000
Revenue 348,433 107,736 - 456,169
Cost of sales (122,557) (60,590) - (183,147)
---------- ------------ ------------ ----------
Gross profit 225,876 47,146 - 273,022
Operating costs (163,484) - - (163,484)
---------- ------------ ------------ ----------
Operating contribution 62,392 47,146 - 109,538
Licence income - - 14,384 14,384
---------- ------------ ------------ ----------
Segment result 62,392 47,146 14,384 123,922
Reconciliation of segment result to profit before tax
Segment result 62,392 47,146 14,384 123,922
Other operating costs - - - (63,713)
Other operating expense - - - (840)
----------
Operating profit 59,369
Net finance expense - - - (1,400)
Share of profit of jointly controlled entity, net of tax - - - 695
----------
Profit before tax - - - 58,664
----------
Capital expenditure 19,386 1,153 - 20,539
Unallocated capital expenditure - - - 68,994
----------
Total capital expenditure 89,533
----------
Depreciation and amortisation 11,966 258 - 12,224
Unallocated depreciation and amortisation - - - 2,705
----------
Total depreciation and amortisation 14,929
----------
Segment assets 186,826 60,468 - 247,294
Deferred tax assets - - - 6,313
Derivative financial assets - - - 2,850
Intangible assets - head office - - - 14,199
Property, plant and equipment - head office - - - 67,072
Other assets - - - 2,618
----------
Total assets 340,346
----------
Segment liabilities (75,232) (23,726) - (98,958)
Income tax payable - - - (8,382)
Term loan - - - (60,000)
Other liabilities - - - (407)
----------
Total liabilities (167,747)
----------
Net assets 172,599
----------
3. Finance income and expenses
Unaudited Unaudited Audited
28 weeks 28 weeks 52 weeks ended
ended ended 15 August 30 January 2016
13 August 2015
2016
GBP'000 GBP'000 GBP'000
Finance income
- Interest receivable 13 13 -
- Foreign exchange gains 1,252 9 531
----------- ----------------- -----------------
1,265 22 531
----------- ----------------- -----------------
Finance expenses
- Interest payable (1,518) (640) (1,430)
- Foreign exchange losses (54) (698) (501)
----------- ----------------- -----------------
(1,572) (1,338) (1,931)
----------- ----------------- -----------------
4. Earnings per share
Unaudited Unaudited Audited
28 weeks 28 weeks 52 weeks ended
ended ended 30 January 2016
13 August 15 August
2016 2015
Number of shares: No. No. No.
Weighted number of ordinary shares outstanding 43,986,705 43,934,613 43,950,203
Effect of dilutive options 631,423 656,613 612,138
----------- ----------- -----------------
Weighted number of ordinary shares outstanding - diluted 44,618,128 44,591,226 44,562,341
----------- ----------- -----------------
Earnings: GBP'000 GBP'000 GBP'000
Profit for the period, basic and diluted 16,318 13,094 44,235
Basic earnings per share 37.1p 29.8p 100.6p
Diluted earnings per share 36.6p 29.4p 99.3p
5. Dividends per share
Unaudited Unaudited Audited
28 weeks ended 13 August 28 weeks ended 15 August 52 weeks ended 30 January
2016 2015 2016
GBP'000 GBP'000 GBP'000
Final dividend paid for the
prior year of 34.6p per
ordinary share (2015:
29.0p) 15,215 12,739 12,739
Interim dividend paid 2016:
Nil (2015: Nil) - - 5,804
-------------------------- -------------------------- --------------------------
15,215 12,739 18,543
-------------------------- -------------------------- --------------------------
The Board has declared an interim dividend of 14.8p per share
(2015:13.2p) payable on 18 November 2016 to shareholders on the
register at 21 October 2016.
6. Income tax expense
The Group's full year forecast effective tax rate in respect of
continuing operations for the 28 weeks ended 13 August 2016 is
24.0% (28 weeks ended 15 August 2015: 26.5%, 52 weeks ended 30
January 2016: 24.6%).
This effective tax rate is higher than the UK corporation tax
rate for the period of 20% due to higher overseas tax rates and the
non-recognition of losses in overseas territories where the
businesses are still in their development phase.
On 1 April 2015, the UK corporation tax rate fell from 21% to
20% and further reductions to 19% from 1 April 2017 and to 17% from
1 April 2020 have been substantively enacted.
Our future effective tax rate is expected to remain higher than
the UK tax rate as a result of overseas profits arising in
jurisdictions with higher tax rates than the UK.
7. Long-Term Incentive Plan
Share awards are made in the form of nil-cost options under the
Ted Baker Plc Long-Term Incentive Plan 2013 ("LTIP 2013"), which
was approved by the shareholders at the general meeting held on 20
June 2013. A fourth award of options was granted under the LTIP
2013 on 5 May 2016. The options will be exercisable three years
after the date of grant subject to the satisfaction of profit
before tax per share and share price performance targets, each
measured over a three year period. The profit before tax per share
target is calibrated so that the percentage of awards that vests is
linked to the level of profit growth achieved.
The terms and conditions of the LTIP 2013 awards made during the
28 weeks ended 13 August 2016 are as follows:
Grant date Type of award Number of shares Vesting conditions Vesting period
5 May 2016 LTIP 2013 234,159 Profit before tax per share growth of Up to 100% after 3 years
10-15% per annum and 10% share price
growth over the
vesting period
The charge to the income statement for the 28 weeks ended 13
August 2016 for LTIP 2013 awards amounted to GBP869,170 (28 weeks
ended 15 August 2015: GBP912,154, 52 weeks ended 30 January 2016:
GBP1,777,000)). Included in the charge for the period is an amount
in respect of R S Kelvin, who is employed by the Company, amounting
to GBP134,622 (28 weeks ended 15 August 2015: GBP125,501, 52 weeks
ended 30 January 2016: GBP246,147).
The Monte-Carlo valuation methodology has been used as the basis
of measuring fair value of awards made under the LTIP 2013. The
range of inputs into the Monte-Carlo model was as follows:
Share price at grant 1,705.0p - 2,855.0p
Share price at grant (based on 3-6 month average) for share price performance condition 1,318.0p - 2,744.0p
Risk free interest rate 0.51% - 1.18%
Expected life of options 3 years
Share price volatility 29.0%-31.05%
Dividend yield 1.41% - 2.02%
8. Reconciliation of cash and cash equivalents per balance sheet to the cash flow statement
Unaudited Unaudited Audited
13 August 2016 15 August 2015 30 January 2016
GBP'000 GBP'000 GBP'000
Cash and cash equivalents per balance sheet 25,525 14,354 13,295
Bank overdraft per balance sheet (81,702) (68,770) (37,869)
--------------- --------------- ----------------
Cash and cash equivalents per cash flow statement (56,177) (54,416) (24,574)
--------------- --------------- ----------------
During the period, the Group agreed an extension of its
multi-currency revolving credit facility with the Royal Bank of
Scotland and Barclays. A new agreement was signed on 31 May 2016,
increasing the Group's committed borrowing facility from GBP85.0m
to GBP110.0m expiring on March 2018. The new borrowing is on the
same terms and contains the same covenants as the previous facility
which are appropriate to the Group and will be tested on a
quarterly basis.
9. Intangible assets
Intangible asset additions during the period include GBP4.3m (15
August 2015: GBP3.1m, 30 January 2016: GBP6.0m) in relation to the
Microsoft Dynamics AX systems and to e-commerce platforms.
10. Property, plant and equipment
Property, plant and equipment asset additions during the period
include GBP17.2m (15 August 2015: GBP14.6m, 30 January 2016:
GBP83.5m including GBP58.0m in relation to the acquisition of the
Ugly Brown Building freehold interest) in relation to stores opened
and refurbished, as well as costs relating to the new European
distribution centre.
11. Financial Instruments
The Group held certain financial instruments at fair value at 13
August 2016. The definitions and valuation techniques employed for
these as at 13 August 2016 are consistent with those used at 30
January 2016 and disclosed in Note 22 on pages 95 to 101 of the
2016 Annual Report:
- Level 1 quoted prices (unadjusted) in active markets for
identical assets or liabilities.
- Level 2 inputs other than quoted prices included within Level
1 that are observable for the asset or liability, either directly
(i.e. as prices) or indirectly (i.e. derived from prices).
- Level 3 inputs for the asset or liability that are not based
on observable market data (unobservable inputs).
Valuation of all financial assets and liabilities carried at
fair value by the Group is based on hierarchy Level 2.
While the carrying values of assets and liabilities at fair
value have changed since 30 January 2016, the Group does not
consider the movements in value to be significant, and the
categorisation of these assets and liabilities in accordance with
the disclosure requirements of IFRS 7 has not materially
changed.
Level 2 assets and liabilities are shown as:
Unaudited Unaudited Audited
13 August 15 August 30 January
2016 2015 2016
GBP'000 GBP'000 GBP'000
Assets at fair value:
Currency derivatives 10,117 1,118 2,850
Liabilities at fair value:
Currency derivatives (1,228) (1,243) (352)
12. Related parties
The Company has a related party relationship with its executive
and non-executive directors.
Directors of the Company and their immediate relatives control
35.5% (2015: 35.6%) of the voting shares of the Company.
At 13 August 2016, the main trading Company owed the parent
company GBP31,968,000 (15 August 2015: GBP29,037,000) and one of
its subsidiaries GBP1,367,000 (15 August 2015: GBPnil). The main
trading company was owed GBP131,311,000 (15 August 2015:
GBP84,326,000) from other subsidiaries within the Group.
Transactions between subsidiaries and between the parent and
subsidiaries were priced on an arm's length basis.
The Group has a 50% interest in a joint venture company in
Australia which is also the parent company of a subsidiary joint
venture in New Zealand. As at 13 August 2016, the joint venture
owed GBP925,000 to the main trading company (15 August 2015:
GBP694,000). The value of sales made to the joint venture by the
Group in the period was GBP1,519,000 (15 August 2015:
GBP1,427,000).
13. Principal risks and uncertainties
The principal risks and uncertainties affecting the Group were
identified as part of the Group Strategic Report, set out on pages
17 and 18 of the Ted Baker Annual Report and Accounts for the year
ended 30 January 2016, a copy of which is available on the website
at www.tedbakerplc.com.
The Group has established a structured approach to identify,
assess and manage these risks and this is regularly monitored and
updated by the Risk Committee. The following list highlights some
of the principal risks, which are unchanged from year end and
remain relevant for the second half of the financial year:
Strategic Risks
* Reputational risk to our brand as a result of our
actions or those of our partners
* Risk that our offer will not satisfy the needs of our
customers or that we fail to correctly identify
trends
* Failure in growing the international business through
franchise operations, licensees and e-commerce
* Significant external events affecting our supply
chain, customers and partners, risking an increase in
our cost base and adversely affecting our revenue
Operational Risks
* Failure in our supply chain affecting our ability to
deliver our offer to customers and/or partners
* Operational problems affecting the internal
infrastructure of our business
* Failure to operate in a sustainable and responsible
manner
* IT security breach and loss of controlled data
* Poorly managed implementation or take-up of new
systems, leading to business disruptions
* Loss of key individuals
* Non-compliance with applicable legislation and
regulations
Financial Risks
* Failure of counterparties
* Currency, interest and credit risks
* Financial covenants under credit facilities
Responsibility statement of the directors in respect of the
interim financial statements
The directors confirm that to the best of their knowledge:
-- the condensed financial statements have been prepared in
accordance with IAS 34, Interim Financial Reporting as adopted by
the EU;
-- the interim management report includes a fair review of the information required by:
(a) DTR 4.2.7R of the Disclosure and Transparency Rules, being
an indication of important events that have occurred during the
first 28 weeks of the financial year and their impact on the
condensed financial statements, and a description of the principal
risks and uncertainties for the remaining 24 weeks of the financial
year; and
(b) DTR 4.2.8R of the Disclosure and Transparency Rules, being
related party transactions that have taken place in the first 28
weeks of the current financial year and that have materially
affected the financial position or performance of the entity during
that period; and any changes in the related party transactions
described in the last annual report that could do so.
The directors of Ted Baker Plc are listed on page 38 of the
financial statements as at, and for, the 52 weeks to 30 January
2016. A list of current directors is maintained on the Ted Baker
Plc website, at: www.tedbakerplc.com
By order of the Board
R S Kelvin CBE L D Page
Founder and Chief Executive Chief Operating Officer and Group Finance Director
11 October 2016 11 October 2016
Cautionary statement regarding forward-looking statements
This announcement contains certain forward-looking statements.
These forward-looking statements include matters that are not
historical facts or are statements regarding the Group's
intentions, beliefs or current expectations concerning, among other
things, the Group's results of operations, financial condition,
liquidity, prospects, growth, strategies, and the industries in
which the Group operates. Forward-looking statements are based on
the information available to the directors at the time of
preparation of this announcement, and will not be updated during
the year. The directors can give no assurance that these
expectations will prove to have been correct. Due to inherent
uncertainties, including both economic and business risk factors
underlying such forward looking information, actual results may
differ materially from those expressed or implied by these
forward-looking statements.
INDEPENDENT REVIEW REPORT TO TED BAKER PLC
Introduction
We have been engaged by the company to review the condensed set
of financial statements in the interim results announcement for the
28 weeks ended 13 August 2016 which comprises the Condensed Group
Income Statement, the Condensed Group Statement of Comprehensive
Income, the Condensed Group Statement of Changes in Equity, the
Condensed Group Balance Sheet, the Condensed Group Cash Flow
Statement and the related explanatory notes. We have read the other
information contained in the interim results announcement and
considered whether it contains any apparent misstatements or
material inconsistencies with the information in the condensed set
of financial statements.
This report is made solely to the company in accordance with the
terms of our engagement to assist the company in meeting the
requirements of the Disclosure and Transparency Rules ("the DTR")
of the UK's Financial Conduct Authority ("the UK FCA"). Our review
has been undertaken so that we might state to the company those
matters we are required to state to it in this report and for no
other purpose. To the fullest extent permitted by law, we do not
accept or assume responsibility to anyone other than the company
for our review work, for this report, or for the conclusions we
have reached.
Directors' responsibilities
The interim results announcement is the responsibility of, and
has been approved by, the Directors. The Directors are responsible
for preparing the interim results announcement in accordance with
the DTR of the UK FCA.
The annual financial statements of the group are prepared in
accordance with IFRSs as adopted by the EU. The condensed set of
financial statements included in this interim results announcement
has been prepared in accordance with IAS 34 Interim Financial
Reporting as adopted by the EU.
Our responsibility
Our responsibility is to express to the company a conclusion on
the condensed set of financial statements in the interim results
announcement based on our review.
Scope of review
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410 Review of
Interim Financial Information Performed by the Independent Auditor
of the Entity issued by the Auditing Practices Board for use in the
UK. A review of interim financial information consists of making
enquiries, primarily of persons responsible for financial and
accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit
conducted in accordance with International Standards on Auditing
(UK and Ireland) and consequently does not enable us to obtain
assurance that we would become aware of all significant matters
that might be identified in an audit. Accordingly, we do not
express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that
causes us to believe that the condensed set of financial statements
in the interim results announcement for the 28 weeks ended 13
August 2016 is not prepared, in all material respects, in
accordance with IAS 34 as adopted by the EU and the DTR of the UK
FCA.
Robert Brent
for and on behalf of KPMG LLP
Chartered Accountants
15 Canada Square
London
E14 5GL
11 October 2016
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR GGGBUUUPQGBU
(END) Dow Jones Newswires
October 11, 2016 02:00 ET (06:00 GMT)
Ted Baker (LSE:TED)
Historical Stock Chart
From Jun 2024 to Jul 2024
Ted Baker (LSE:TED)
Historical Stock Chart
From Jul 2023 to Jul 2024
