Companies: TBK   

Fashion retailer Ted Baker appears to be performing well in spite of what it admits are tough times for the high street.

Finance director Lindsay Page attributes the company’s success to its globally recognised brand and loyal customer base, claiming, ‘Although we are approaching the market with caution, the one thing we do know is that we’ll do better than most.’

This confidence was reflected in the board’s decision to increase the interim dividend by 5% to 5.25p, following a half-year to 9 August in which pre-tax profits increased 5% to £7.4m on revenues up 8.2% to £71.6m.

In the second half of the year, Ted Baker plans to open two new stores. However, beyond these plans it does not have any more outlets scheduled to open for this period. But Lindsay says the company is in a cash-positive position to snap up more property should attractive opportunities arise – opting for a wait-and-see policy towards expansions. The company has cash of £6.4m to take advantage of future commercial property bargains but an overdraft of £7.3m.

However, despite its optimism, the board reported a more recent slowdown in sales, which it attributed to ‘unseasonably warm weather’ as well as economic uncertainty. And while Ted Baker has a degree of robustness that should see it outperform peers, with the retail outlook looking bleaker by the day, the shares are best avoided for now.

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Ted Baker	LSE	£124.07m	298.25p	8.25p
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