By Sachin Ravikumar
(Reuters) -British fashion chain Ted Baker said on Thursday sales were rebounding as office and party wear become popular again after the lifting of COVID-19 restrictions, but signalled that the pace of recovery was still uncertain.
Ted Baker and other apparel retailers are navigating a bumpy road back to normal as demand for office and party wear grows again, but anaemic levels of tourism in places such as London had hurt store footfall.
“We are optimistic but we’re also being reasonably cautious on outlook in the next quarter and the next year,” Chief Executive Rachel Osborne said in an interview. “For us, a full return to international tourism would really help the bounce back.”
Ted Baker, which has 377 stores and concessions with three-quarters of those located in the United Kingdom, Europe and North America, said demand for formal wear, suiting and occasion wear pushed group revenue up 18% year-over-year in the 28 weeks to Aug. 14. Loss before tax narrowed to 25.3 million pounds ($34.2 million) from 86.4 million a year earlier.
The rising number of COVID-19 vaccinations in Europe and North America has encouraged many workers back to return to their offices, with Ted Baker’s revenue from North America jumping by a third. Customers looking ahead to parties and the Christmas season were also helping, Osborne said.
Shares in the upmarket retailer were up 5.3% at 143.9 pence by 0905 GMT.
Group revenues were, however, still down 36% compared to pre-pandemic levels in 2019, suggesting a longer road to recovery.
“Within our store portfolio there have been clear changes in footfall patterns and there is uncertainty over the timing and degree of the return to previous patterns,” Osborne said in a statement.
The upmarket retailer is now half-way through a three-year turnaround that was launched by Osborne and is focused on cost cuts and boosting its online presence and product range.
It has also been working to repair its image after former boss Ray Kelvin left in 2019 following misconduct allegations. Kelvin, who started the company in 1988 in Glasgow in Scotland, has denied the allegations.
Ted Baker did not provide annual financial forecasts but said it was “comfortable” with current analyst expectations for the financial year.
Third-quarter group revenue – for the 12 weeks to Nov. 6 – also jumped by 18%, the company said.
($1 = 0.7389 pounds)
(Reporting by Sachin Ravikumar in Bengaluru; Editing by Ramakrishnan M., Editing by Timothy Heritage)
